§ 3.36 p.m.
§ Mr. E. Shinwell (Easington)
In the years between the two wars, and indeed long before then, the cost of living in relation to wage rates was regarded by the Labour Party as an issue of the highest importance. In those days, food and other essential household requirements were relatively cheap, but, as compared with the general level of wages, prices were far too high. It is doubtful whether prices will ever again fall to the level of the pre-war years. This is due to the presence of several new factors.
There has been a remarkable increase in world population; living standards have improved, though they are still far from satisfactory, while production of some commodities has failed to keep pace with consumer demand. So it is unlikely that the days of cheap food, clothing and the rest will ever return. Besides, primary producers are entitled to a fair deal. They have been exploited long enough. Nevertheless, we cannot meekly accept the new situation, but must always keep before us the need for raising the standard of living, 36 in particular for those in the lower income groups.
It is because of these considerations that the Labour Opposition has raised this debate. Our immediate purpose is to extract from the Government some idea of what is their solution of the problem of living costs. I make no apology for asking questions on the cost of living and the rise in food prices. Moreover, we must direct attention to the inconsistency between the statements made by Tory candidates during the General Election and their apologetic declarations ever since.
By extravagant promises made by members and supporters of the Government, the Tory Party managed to get themselves returned to power—at any rate for a short time. But the facts are now beginning to dawn upon the public. We are justified in recalling the exaggerated propaganda conducted by the Tories; the thousands of scurrilous posters, the mass hypnosis and the hysteria—all part of the election stock-in-trade of the Tory Party—together with the flambuoyant broadcasts of Lord Woolton and, last but certainly not least, the Parliamentary Secretary to the Ministry of Food.
The hon. Member for Luton (Dr. Hill) worked himself up into a state of almost homicidal excitement during the General Election. Now that he occupies a position of more responsibility and less freedom he is cultivating almost a bedside manner—indeed, almost a graveside manner. He appears to have taken a sedative for which, no doubt, he has paid the customary shilling prescription fee. Instead of the bombastic utterances, the arrogance and the raucous criticism, he seems to be almost deflated. This is a most welcome metamorphosis.
Many Tory back benchers indulged in the most vile misrepresentation of the food policy of the Labour Government. It would be interesting to learn what some of their constituents are saying about the promises they made at the Election in their desperate efforts to drive the Labour Party out of office. To quote from their election utterances would be superfluous; the record of the present Government in the last few months speaks for itself. This is the concern of millions of people, many of whom voted for the Conservative candidates at the election 37 and helped to return the present Government.
I must avail myself of this opportunity to invite the attention of hon. Members to an amazing statement which was made by the Parliamentary Secretary to the Ministry of Transport, as reported yesterday in one newspaper. The Parliamentary Secretary said:One of the results of having a Socialist Government for six years is that people are now eating horseflesh. That is a very good example of the situation in which we find ourselves.Members of the Tory Party have frequently sunk low in their political utterances, but I venture to say that this is the limit, though I am reminded—and I agree—that one never can tell.
I should like to put the most important question first. Will Ministers explain why prominent members of the Government made promises at the Election about the Tory Party's intention to reduce the cost of living? Do the Government believe that those promises have been fulfilled? If so, will they indicate what has been achieved in the reduction of living costs? If not, can they explain the reason for their failure?
Secondly, I should like to put a question of importance in relation to our balance of payments position. Have the Government considered the effect of a rise in the cost of food on the policy of wage restraint? Moreover, should industrial disputes occur as a result of the workers' demands being rejected, what would be the cost to the nation? Furthermore, should concessions be made to the workers' demands, would the cost be more than the Chancellor will gain by cutting imports and reducing the food subsidies? Furthermore, will Ministers be good enough to tell us what will be the effect of this policy on our export trade?
I must tell the Ministers who are responsible—some of whom are present, some of whom are unable to be with us because of other engagements, and others, perhaps more culpable than the rest, who are in another place and therefore shielded from attack in this Committee, for which they must feel grateful—that evasion will not do. These questions must be answered, we hope to the satisfaction of the Committee, and not by casting the blame on the world situation or on the late Government, or by any other form of passing the buck.
38 If the Ministers who are to respond feel that the questions are too difficult to answer, they have time to acquaint their superiors in the Cabinet so that we may have a considered reply before the debate comes to an end; but we must make it clear to all concerned that should the Government fail to satisfy the Committee the matter will not rest there, because the electors will still remain dissatisfied, discontent will grow and thus bring about results which will weaken the nation and eventually overwhelm the Government. We shall, of course, bear the latter event with the utmost relief.
When the Labour Government were returned in 1945, the shortage of food and other supplies was acute. That was inevitable, because the production of foodstuffs was retarded by the war. In consequence world prices increased sharply, even in food-producing countries, and this country, where, unfortunately, we produce far too little food to sustain our large population, was amongst the worst affected. But few, if any, countries escaped. We had therefore to increase the amount spent on subsidies by many millions of pounds. This was done for two reasons. One was to provide an umbrella to shield the people from the harsh effects of high prices, and the other was to restrain excessive wage demands. Our export trade would have suffered if we had failed to do this.
When the Labour Government took office in 1945, food subsidies were £265 million a year. By 1948–49 they had been increased to £485 million. In 1949–50 they were £465 million, and from 1950 to 1952 they were fixed at £410 million. Now they have been cut to £250 million, that is to say, less than the level at the end of the war, although the whole level of prices has increased. Moreover, we always left ourselves free to adjust the figure upwards if it were considered necessary.
The Tory Opposition always denied that world prices had anything to do with the level of prices at home, and they blamed it all on the Labour Government. Of course, facts were against them, but the Tories never trouble themselves about facts when prejudice can serve them better. Now, when the Tory Party are in power and food prices at home are rising, they seek to put all the blame on world prices and accept no 39 responsibility themselves. During Labours' term of office the Tory Opposition persistently assailed the Labour Government with the most fantastic charges and completely ignored the trend of world prices. Now world prices, apart from food, are no longer rising. On the contrary, the latest figures disclose that wholesale commodity prices have declined by an average of 25 per cent.
Let us look at the food price position. There is hardly a single food which has not been affected by price increases since this Government came into office. This applies both to rationed and to unrationed goods. According to the Parliamentary Secretary's own statement, as can be seen from the OFFICIAL REPORT, 11th June,In the six months to the middle of May, 27 items, apart from seasonal increases in the price of some fresh fruits and vegetables … rose from 4 per cent. to 33 per cent."—[OFFICIAL REPOR r, 11th June, 1952; Vol. 502, c. 207.]I believe that is a very modest statement; indeed, I regard it as an understatement of the position.
It may be useful to recite some of the facts about the rise in food prices since the present Government were returned. This can be done without cluttering up the case with any reference to the Retail Price Index which, as we know, was changed in January of this year. The fewer complications there are, the better. Besides, housewives are not interested in the price index but in what the prices are in the shops.
I have in my possession several documents, including a report of the broadcast of the hon. Member for Luton called "Not in front of the children." As if he had anything to hide! I have other documents relating to the remarkable declarations of Lord Woolton. Here is a list of almost 100 items of food and other household necessities, all of which have advanced in price.
§ Mr. Shinwell
I would oblige my hon. Friend, but I do not want to harrow the souls of right hon. and hon. Gentlemen opposite. Food is the principal requirement in the household, but no housewife could run a house on food alone. All kinds of articles are essential, like soap 40 and cleaning materials and condiments; and there are many others in daily use.
Worst of all, the price of bread has been raised, and this, for most families in the low income groups, is one of the largest items. The increased cost, along with the rise in flour prices, for the average family of four or five persons means a substantial increase in expenditure every week. What must it be for large families? We know that children consume large quantities of bread. Moreover, it is estimated—and this is an indication of the gravity of the position about bread—that the sum saved by the reduction in the amount expended on the bread subsidy will be £45 million. That is a very serious situation indeed.
Milk is another costly item in the family budget, particularly where there are many children. Meat prices have risen by 4d. to 6d. a 1b., so that thousands of housewives can no longer afford to buy it and, in consequence, most of it is going to those families who can afford to pay because their incomes are higher. The best quality of meat is quite beyond the reach of working-class families. All the same, I will make the Government this concession: I have read that the golf ball manufacturers' association have decided to reduce the price of golf balls by 6d. That is the way to bring down the cost of living. I hope the Government will not claim any credit for it.
Not only are food and other prices rising, but earnings have sharply declined. If we take the old index figure of retail prices, we find that they have risen in excess of earnings. On the average, the wage earners are worse off under a Tory Government than they were while Labour was in power. Moreover, we have to consider the effect of rising unemployment. This is reflected in lower consuming power, leading to fewer purchases. It is the unemployed who suffer more harshly because, as a result of their reduced income, they have less to spend, while, on the other hand, prices are rising sharply against them. The old-aged and other pensioners, who have to make do on a modest allowance, also suffer.
Let us examine the policy of the Government in relation to the question of wages. The Chancellor of the Exchequer is asking the trade unions to restrain their members from asking for increased wages. I must say that this 41 comes strangely from a party which all along has demanded that we should set the people free and which is opposed to restrictions and controls of any sort. Restraint is surely not a Tory virtue. While the Government believe in free enterprise, the workers must be restrained from demanding wage rates which will enable them to live reasonably well; but, at the same time, be it noted, industrial undertakings, in spite of taxation and voluntary limitation of dividends, manage to do exceedingly well by their share-holders.
It is the trade union leaders who have shown the utmost concern over the country's position, who have all along adopted a conciliatory attitude and who are anxious to prevent inflation. What help have the trade unions received from the Government? When the Tories were returned to power, the trade union leaders offered to help in combating the dangers which threatened the country. They also asked, very modestly, that before the Government pursued an economic policy which must worsen the living conditions of their members, consultations should take place. In particular, they directed attention to the danger of removing the food subsidies because of the effect upon the cost of living. The Chancellor of the Exchequer was warned, but he ignored the advice of the trade union leaders.
While negotiations are proceeding on the wages question, it would be quite improper to make any comment on the merits, but there are two observations which I must make. The first is that if only 50 per cent., or even 25 per cent., of the workers' demands be accepted, it will more than wipe away the whole of the alleged advantages which the Chancellor of the Exchequer believes he gained by the imports cuts and the reduction in the food subsidies. Nothing could be more futile, therefore, than such a policy. Secondly, most wage rates are still much too low—that is, if the standards of living are to reach the levels which we on the Labour side believe to be essential.
I frankly confess that I am completely baffled as to how the mass of wage earners, receiving less than £8 weekly, manage to live, what with high rents, transport costs, food, clothing and the like. And what about the plight of old-age pensioners, the war disabled and 42 others receiving National Insurance benefit? Strangely enough, this is at a time when the John Lewis Partnership, for some unaccountable reason, have decided to reduce the wages and salaries of their thousands of employees. What possible advantage can the adoption of such a policy be to the consumers in general?
Of course, the price of some textile goods is falling. So are the prices of some other domestic articles. But why? It is not because there is any virtue in the Government's policy, but because consumer demand has fallen off in almost every country. We know that the prices of some goods in the shops are much reduced. We can see that for ourselves. But that brings no benefit to those who are employed in industries like textiles, boots and shoes, or furniture; nor does it help the consumers of foodstuffs.
In the normal course one would have expected that as prices other than for food fell, the demand would have increased; but in fact that is far from being so. And why? It is because in the vast number of homes, particularly where wages are still on a low level, the people are compelled to spend so much on food out of their incomes that very little is being left to enable them to buy the other goods which they need. As a result, they go short of what in normal circumstances they would like to buy. We are not, as some would have us believe, suffering from over-production, but from under-consumption. That is the trouble.
Whether the Government like it or not, I accuse them of deliberately provoking unemployment. In the last few months bank credits have been restricted by over £52 million. The result is that many manufacturers, particularly those in a modest way of business, are quite incapable of carrying on. In due course there' will be many bankruptcies arising from the Government's policy. Who can doubt that a slump is certain to come if this policy is continued? When we take into consideration idle factories with idle machines requiring maintenance, and also the cost of overheads, the loss sustained may be greater than the loss that might have accrued if bank credits had been extended. It would have been wiser to have enabled production to continue even if it only meant stockpiling in readiness for the end of this recession.
43 But the most remarkable commentary on the Government's policy is the recent statement by an official of the Pawnbrokers' Association that for six years very little business was done in their profession but that now things are beginning to pick up, and they are looking forward to brighter times. These are the benefits this Tory Party, this Tory Government, have offered to the people of this country. That is what the policy of the Government has brought us to. This is the tragic result of relying on people like Lord Woolton and the back-room boys of the Tory Central Office for advice on national domestic affairs.
If the Tory Government, instead of seeking to turn back the hands of the clock and revenging themselves on the Labour Government, had at the very least retained the food subsidies, they would have provided, despite the harsh bleatings of many of their big business and financial supporters—or should I say masters?—some cover against world economic trends. No, Sir, the umbrella was thrown away, and now the storm has broken, flooding the lives of millions with insecurity, making conditions for our housewives intolerable, and destroying the policy of wage restraint. Eventually it will cause this Government to be overthrown, and, fortunately, the Tory Party will be deprived of any share in our national affairs.
So the cumulative effect of the Government's policy in reducing food subsidies and in cutting imports will be to throw greater burdens on the majority of the population whose incomes are on the lower scale; on the other hand, it has given those with money to spend the opportunity of getting more than a fair share of foodstuffs, not so much because they need them but because they can afford to buy them. It has also created a feeling of insecurity among the people, who, seeing the rise in unemployment, are reluctant to spend any of their modest savings on textile and other goods, and this in turn creates more unemployment.
It is a policy which has embarrassed the trade union leaders, who wish to avoid the evils of inflation but who, in face of rapid price increases, are compelled to demand higher wage rates for their members. It is a policy which may lead to industrial disputes, the results of 44 which may prove more costly than the food subsidies; and it could hamper our prospects of improving the export trade, owing to higher wage costs.
Over and above all this, the Government appear to be quite incapable of grappling with the situation, of finding a solution, and content themselves with vague assurances about the future. Meanwhile, the electors who helped to return the Government are rapidly becoming disillusioned, and their demands for alleviation, which cannot be satisfied by the Government, are fast leading to demands for the ejection of those failures who promised so much but whose performance has fallen far short of what was expected.
But what is even more important than this failure of the Government's policy is the need for the adoption of constructive measures to ensure increased food supplies and a reduction in price. First of all, the most vigorous steps are necessary to raise the production of food at home. Much has already been done; but while I give full credit to the farming community for their achievements in the past few years, greater efforts are required. In the coming years the food problem will be the most urgent of all. What should be produced and how to produce it is a matter for the experts. I am not competent to judge.
§ Mr. Shinwell
—because so far they have failed to remedy the position. They have the opportunity. We must shake off much more of our dependence upon foreign food supplies, otherwise our position will become intolerable.
§ Mr. Julian Amery (Preston, North)
I am grateful to the right hon. Gentleman for giving way. Is he aware that in the last year while his party were in office the total share of the capital investment programme devoted to agriculture was under 5 per cent. of the total?
§ Mr. Shinwell
What I do say is this. In the last six years of the Labour Government more was done for the farming 45 community than was ever done in the history of the Tory Party. [HON. MEMBERS: "Oh."] That statement is unchallengeable. The facts are inescapable. I invite the hon. Gentleman to subject the figures and the facts to objective analysis, and he will discover that what I have said is true. Therefore, his question is quite irrelevant to the issues before us.
Furthermore, the Government, in association with local authorities, should help to form food producers' groups in every town and village, using allotments and waste land to the utmost advantage. I am bound to say that I do not pretend to have any knowledge of agriculture.
§ Mr. Shinwell
Certainly I am not so knowledgeable as hon. Members opposite think they are, but nevertheless I am appalled at the amount of waste land in this country. If we made an effort to cultivate our soil—I am not complaining of the farming community—as they do on the Continent, in Belgium, Denmark, France and Holland, using almost every inch of land, I think we could produce far more than we are now producing.
§ Mr. Shinwell
The country must be made to understand the urgency of raising our food supplies to the highest possible level. Meanwhile, the Government should consider their food subsidy policy and admit its futility. They must recognise that a fundamental error was made by reducing the food subsidies at this time. Essential food imports should not be cut, even if it means restricting the imports of some other articles like foreign wines, films and the like.
The Government have now got the power and the opportunity partly to redeem their failure and to avoid the industrial blizzard which may descend upon us unless prompt action is taken. I advise the Government to forget all about their prestige and to consider the consequences of their policy upon the lives of our people. If they are unwilling to do so, then the sooner they clear out the better it will be for the country, for already in a few months of office they have, by a succession of futile actions, outstayed their welcome.
§ 4.11 p.m.
§ The Minister of Food (Major Lloyd George)
I am in some ways grateful to the right hon. Member for Easington (Mr. Shinwell) because he has not given me a great deal to answer. He asked one or two questions, which I hope to deal with in the course of my speech. For instance, he asked why we have failed to reduce the cost of living, what is our solution to the present problem, the effect of our policy on wage restraint, and lastly, the effect of our policy on exports.
I was interested in that last question coming from him, because I have a very clear recollection of his views about exports not so many years ago, when I heard him say that never had there been such a fallacy. He also referred to extravagant promises that had been made. I do not think it comes very well from the Opposition to talk about extravagant promises. I ask hon. and right hon. Members opposite to look back over some of their remarks about food only in the last few years and to examine the position when they left office. I think the less they say about promises the better for all of us.
The right hon. Gentleman also said that it was not really right for us to try to put the blame on the preceding Government. In other words, he said, "Do not try to pass the buck." As the party opposite were inclined to try to put the blame on us last November, within about a week of our taking office, I think it is perfectly fair to point out what the position has been and what has led up to the position in which we find ourselves.
Therefore, I shall not respond to the appeal not to pass the buck. I propose to pass it as much as I possibly can, passing it forward across the Table and not sidewise. I hope in the course of my remarks to be able to deal with many of the points which the right hon. Gentleman raised about home food production and the importance of food. The desire to regard that as an important item in our national life is not, may I say, held only by the Labour Party.
The Government welcome this debate because it provides an opportunity for us to do two things. Firstly, by reminding the Committee how the late Government failed to deal with this very problem that has been raised today it enables us to expose the claim of the Opposition to be the only party to be concerned with 47 the cost of living. Secondly, we welcome the opportunity to show their responsibility for the general economic difficulties which face this country, of which the cost of living is one aspect.
There is no desire on this side of the Committee to under-estimate the effects of any increase in the cost of living, however small, on all our constituents. We must seek out the reason for these increases. We must look at the facts. The right hon. Gentleman dealt with the general question of the cost of living, but as this debate has particular reference to food—and as, indeed, the prices of goods other than foods are beginning to look considerably more healthy—I propose to devote my arguments mainly to the particular subject of food.
There are, as I see it, three important questions with which I must deal.
Firstly, what has happened to the cost of living, particularly food, since the present Administration took office? In dealing with this, I am bound to make some comparisons with the sorry record of the last Administration.
Secondly, what are the reasons for these changes in food prices?
And, finally, what have food subsidies to do with it?
The right hon. Gentleman focused attention in his remarks on increases in prices. Although he talked about the effect on wages, he did not dwell overmuch on the extent to which wage rates and earnings have kept pace with the prices. Nor did he say overmuch about the decision which the Government have taken to increase a wide range of social benefits and to reduce Income Tax. The right hon. Gentleman referred to many people but he made no reference whatsoever to something which the Government did, which was to try to synchronise the increases in prices with the effects they would have. That is something the party opposite did not do, but these factors must be taken into account, as the party opposite have often said.
§ Mr. A. C. Manuel (Central Ayrshire)
The right hon. and gallant Gentleman said that steps had been taken to offset the increases by giving Income Tax relief, changing National Assistance rates, and so on. How has he helped those who pay no Income Tax?
§ Major Lloyd George
I shall not go into that now. I am comparing what we have done with what the late Administration did. We at any rate have attempted to help people on a very large scale. While nobody pretends that everybody will be affected, the fact remains that it is far beyond anything ever attempted by the party opposite. I apologise to the Committee for giving one or two figures but they are essential.
§ Major Lloyd George
That is not a very funny remark.
I apologise for giving figures, but I hope they will be of some help to the Committee. In October, 1950, when the prices began to rise seriously, the Retail Price Index was 115. The index of weekly wage rates was 111. In October, 1951—that is, a year later—the retail price index was 129 and wage rate index 122. In other words, by the time the last Government left office, wage rates had lagged behind prices by an extra three points. In May this year the retail price index was 135 and the wage rate index 129; so in our period of office this gap has been closing.
§ Mr. Frederick Willey (Sunderland, North)
Would the right hon. and gallant Gentleman agree that the relevant figures to take are the November figures. After all, the increase in the wage levels in October would be shown in November.
§ Major Lloyd George
I am taking October to October, because that is when we came in, or when the party opposite went out, which is the same thing.
Wage rates are only one criterion. It may be asked: What about earnings? The index of earnings was 124 in October, 1950, and rose to 136 in October, 1951, and the forecast of the Central Statistical Office is that the earnings figure for May is 144. On this basis, we can say that since October, 1950, retail prices have risen by 17 per cent. weekly wage rates have risen by 16 per cent., and weekly earnings are estimated also to have risen by 16 per cent. These official economic statistics show how unfounded are some of the charges about increases in the cost of living, and how important it is for all concerned to weigh 49 judiciously claims for wage increases at this moment. I think it would be well if we all kept these figures before us throughout this debate.
In October, 1951, when this Government took office, the Interim Index of Retail Prices—all items—was 129. That includes, of course, the food item, which was then 143, but for all items it was 129. The Committee will recall that the interim index was introduced in June, 1947, because of complaints about the unrepresentative nature of the original index. From June, 1947, when the index was introduced, to October, 1951, the index had risen by 29 points, that is, from 100 to 129 from 1947 to 1951. It rose four points in the first six months, five points in 1948, four points in 1949, three points in 1950 and then 13 points in the first 10 months of 1951. This shows a gradual but steady increase in the years when the Opposition were in office, culminating in a steep and spectacular rise in the last 10 months of their administration.
I was very surprised to see a report of a speech made by the right hon. Gentleman the Leader of the Opposition—I think it was at Bristol—earlier this month, when he said that,We kept the cost of living steady by food subsidies.There has been a steady rise since 1947, and in the last 10 months of last year we had one of the most spectacular rises we have ever had. The right hon. Gentleman said that we wanted to try to put the blame on him. It is true that the Labour Government sent the index rocketing upwards, and the right hon. Gentleman now has the impudence to say that we must not blame them for anything that happened in the last six years.
One point which hon. Members should notice is the comparison between the rate of increases in 1951 and in 1952. In 1951, it climbed each month from 117 in January to 124 in May. It climbed steadily each month. This year—mark the difference—it stood at 132 in January, it was 133 in February and it remained unchanged in March. It then went to 135 in April and has remained at that level in May.
§ Major Lloyd George
At least there are signs that our promises are being fulfilled. The index to which I have referred was put forward by the right hon. Gentleman who was then Chancellor of the Exchequer.
§ Major Lloyd George
In any case, it was done by the great brains opposite and not by us and was accepted at that time. This year, to date, the rise in the all-items index has only been three points as compared with seven points in the same period last year.
Now let us examine how the food price index moved. During the second half of 1947 it rose by three points; by the end of 1948 it rose by a further five ponts; then in 1949 it jumped by 12 points to reach 120. It was checked during 1950 and increased by only five points to 125; but in the first 10 months of 1951 it rose by 18 points to 143. That is the cost of food index. That was an even steeper and more spectacular rise.
§ Mr. Shinwell
I do challenge them. The right hon. and gallant Gentleman is throwing figures about quite a lot. I deny the accuracy of his statement completely. [HON. MEMBERS: "Oh."] Of course, I do. I would not have said it if I had not meant it. I will say it again with emphasis. Let me produce a statement and the right hon. and gallant Gentleman can deny it if he likes. From May to November, 1951, the index of weekly wage rates for all workers rose from 118 to 126, or by eight points. In the same period, food prices rose by eight points. Therefore, the wage increases kept pace with the rise in food prices. That is a complete repudiation of what the right hon. and gallant Gentleman has said. That is the cost of living index as a whole taken from Government statistics. Perhaps the right hon. and gallant Gentleman prefers statistics prepared by the Tory Government.
§ Mr. Nabarro
On a point of order. Is it in order, Sir Charles, for the right hon. Gentleman to address the House a second time?
§ Mr. Shinwell
I have been in the House a little longer than the hon. Gentleman and know more about procedure than he does. No doubt, in due course, he will learn to conduct himself properly.
§ Mr. Shinwell
The rise in the cost of living index for all items during that period was only five points between May and November, 1951. That is the period of which we are speaking.
§ Major Lloyd George
I have given my figures, and I am not going to withdraw one of them. They are the only official figures that can be found in this country. I have the whole list before me. The period which I took was quite a different one from that taken by the right hon. Gentleman. I gave the figures and I challenge the right hon. Gentleman to prove what he has said—in other words, that my figures are inaccurate. All I can say is that these are the figures supplied by the only body responsible officially for the figures in this country. These are the figures that have been accepted, and I repeat that the figures I have given are the accurate ones. I challenge the right hon. Gentleman to deny that. I have no doubt he will give all the figures in the world, but we want the accurate ones, and I have just given them.
Now, if I may proceed, whatever the figures, no one will deny that there was a sudden and very sharp rise in food prices in the last 10 months of the last Government. Hon. Members opposite will have to be patient and will have to listen to me. I remember the campaign which my predecessor waged about the fear he had of the increased cost of living when he was chairman of the Labour Party in 1949. He wrote an article about it. He said,The next Labour Government will have to approach the problem along a whole series of roads.He was one of those who chose the road that they had to follow. What happened? In February, 1950, when my predecessor 52 took office, the index of retail food prices stood at 121. When he left the Ministry of Food in October, 1951, the index was 143—a rise of 22 points. That is what happened to my predecessor, and only once since 1919 has there been any increase in food prices to compare with the increase during that period.
§ Major Lloyd George
I will not, if the right hon. Gentleman does not mind. I am getting a bit tired of this.
§ Major Lloyd George
It is no good the right hon. Gentleman popping up like a jack-in-the-box and saying, "I deny those figures." The fact of the matter is that in February, 1950—
§ Major Lloyd George
I am not reading from "The Right Road for Britain." That remark is not even funny. I am reading the official figures. In February, 1950—I am giving a figure which I hope will be accepted—the retail food index was 121, which is the figure given here. I said that in October, 1951, the figure was 143, which is the figure checked on the official returns. These figures are the only official figures and I challenge the right hon. Gentleman any time he likes to prove that they are wrong. He has given me his figures; I have given him mine, and mine are the correct ones.
§ Major Lloyd George
Perhaps the hon. Gentleman will let me make my speech in my own way and not make such fatuous observations.
§ Mr. Callaghan
Might I, then, rise to a point of order, Sir Charles? I wish to ask whether, as a singularly offensive personal remark was made by the Minister, it would be in accordance with tradition and custom for him to give way?
§ Mr. Callaghan
Might I direct your attention, Sir Charles, to the remark of the right hon. and gallant Gentleman to which I take exception. He said that my interventions were of a fatuous nature when he was asked when he intended to bring down the cost of living. Why is it supposed to be fatuous to ask him when he proposes to bring down the cost of food when he based the whole of his electoral campaign on that?
§ Major Lloyd George
If I said anything offensive, I withdraw it, but I see nothing offensive in the word "fatuous," because the hon. Gentleman was fatuous. It was fatuous because at that moment I was not discussing that subject. The hon. Gentleman obviously does not listen to the debate or he would not have made the observation that he did. I was talking to the right hon. Gentleman who was challenging my figures. I repeat that I am not altering a single figure that I have given and it is up to the right hon. Gentleman any time he likes to prove that they are wrong.
I was asked questions about what has happened since October. The revised index of retail prices of food began at 100 in January and reached 104.4 at the end of May. Before the new index was arrived at, the old index had risen from 143 in October when we took office to almost 150 in January. The new index was introduced in January and went up about 4½ points by May.
The Committee will have noticed that both under the last Government and under the present one the index of food prices went up more sharply than the general price index. There are two reasons for this. Firstly, the raw material costs play a greater part in retail food prices than in those of manufactured articles, and this was a time of rising import costs. Secondly—and probably more important—the Labour Government realised—rather late, but better late than never—that they must limit the amount of money that was being transferred from one pocket of the taxpayer to another in food subsidies.
54 One of the first problems that came to our notice on assuming office was that immediate increases in some food prices were required to keep food subsidies within the limit of £410 million laid down by the late Chancellor of the Exchequer. Immediate retail price increases were necessary to save £20 million before the end of March. The outgoing Government, of course, must have been aware over the last months of their period of office that some increases had to be made during the year 1951–52 if subsidies were to be kept within the limit laid down in their own Budget of 1950. It would have been kinder on the housewife if they had made the increase earlier rather than later, because £20 million saved over six or eight months obviously means a less sudden increase than an attempt to save the same sum spread over four months.
The price increases which we had to make at the end of 1951 are the consequences of Socialist failure to take unpleasant decisions before the General Election, which they knew was coming. Not unnaturally, they did not want to lose popularity. We had to recover the £20 million which they had left alone. So we had to make increases in December, 1951, in the prices of bacon and cheese of 10d. 1b. in each case and of milk of ½d. per pint. These three increases caused a rise of 4.9 points in the retail food index. That is almost entirely the responsibility of the other side.
Because they shirked their duty for political reasons, we had to do the work, and I am just saying, in passing, that the responsibility is theirs and not ours. The only other increases in controlled prices in this period were, firstly, a modest increase of ½d. per 1b. in the price of pre-packed flour and semolina—this was necessary because a survey made by the Ministry's own Costings Division showed that the existing prices were inadequate—and, secondly, an increase in the price of sugar confectionery.
Between January and May the index of food prices increased by a little over 4 per cent. This compares very favourably with the increase of 6 per cent. in the corresponding period last year. Of this year's increase, a rise of about two points follows from the decision to which the right hon. Gentleman referred to increase the price of bread and flour. I must observe here that, even if we had 55 kept the food subsidies at £410 million, this increase would still have been necessary to cover the estimated net increased cost of home-produced foods which we foresaw for 1952–53. The increases in the price of flour and bread were designed to save us that £50 million.
While we must all regret the movement of world prices which has made increases necessary, it is not for the Opposition to challenge those increases unless they are prepared to say here and now that, notwithstanding the country's economic plight, they would have increased the food subsidies by £50 million rather than pass on any of this year's increased costs to the consumer. If they would have been ready to do this, let us have it said from the Opposition Front Bench that they would have gone back on their previous decision not to increase the food subsidies above what they were.
The remaining changes in retail food prices up to the end of May amounted to a net increase of two and a half points. A substantial share of this increase comes from the seasonal rise in the price of apples, potatoes and other fruit and vegetables, partly counter-balanced by a fall in the price of fish. These normal seasonal changes account for a rise of roughly two points. The balance comes from a few minor items. I have already referred to the increase in the price of pre-packed flour and sugar confectionery. In addition, the following controlled prices were increased between October and the end of May: sweet biscuits, meat products, and coffee.
The reason for the increase is the same in each case—increased costs of procurement, processing or distribution. I wish to impress upon the Committee that food manufacturers and distributors cannot be isolated from the effects of rising costs, whether they be wages, coal, transport or raw materials; and, indeed, hon. Members opposite who are closely associated with the Co-operative movement, which is responsible for distributing food to about 13 million people, know this to be true.
Since the end of the war the world's capacity to use raw materials and to consume food has developed faster than its capacity to expand raw materials and food supplies. While prices will come down from the abnormal levels which followed Korea, it would be quite wrong 56 to envisage a speedy return to the sort of price levels which we had before the last war. Prices overseas have gone up, and the terms of trade have moved against the United Kingdom, so that more and more exports are needed to pay for our imports. This adverse movement in the general terms of trade has, I am glad to say, been checked since the beginning of this year; but the extent to which our food prices overseas have increased will, I think, surprise many hon. Members.
Before the war the average price we paid for Argentine meat was £38 10s. per ton. The average price for the same meat in the first half of this year was £139 per ton. [An HON. MEMBER: "What about the private buyers?"] May I finish my speech, and then the hon. Member will have an opportunity to make one? Before the war the average price which we paid for Nigerian groundnuts—if I might refer to that commodity here—was £13 per ton; now it is £84 per ton. Sugar before the war cost £10 per ton. We are now paying £46 per ton. Our total food imports in 1938—the last four years before the war—cost £387 million for 22.5 million tons of food and feedingstuffs. Last year we paid £1,379 million for the 18 million tons which we required to import. That works out at roughly £17 per ton before the war and £76 per ton since the war.
The prices of home-produced foodstuffs have also gone up. Both sides of the House have recognised that all who worked on the land—farmers and farm workers—should be justly rewarded for their efforts. The average price paid for wheat to the British fanner in 1936–38 was 9s. 8d. per cwt; it is now 30s. 4d. Milk has gone up from 1s. per gallon to 2s. 10d. per gallon. The price of pigs per score averaged 12s. 4d. before the war, it is now 53s. 6d.
Both home-produced and overseas food prices have gone up, and since the price of so much of the food which we buy today was fixed by the Opposition when they were in power, they know the reasons for the increases. They know that it is a problem which concerns all countries. The United Kingdom, however, is the biggest food-importing country in the world. We depend for 60 per cent. of our supplies on imports. We cannot escape the consequences of these price movements.
57 One of our complaints about the subsidy policy of the Opposition is that it tried to obscure these changes. It was a right and sensible policy to adopt in the war, but once the pattern of the international post-war price relationship was clear, it was folly to try to isolate this country from all the movements which had taken place in our supplying countries. For years the Socialists seemed to pretend that by their domestic policy they could try to reverse the trend of price movements outside. They went to fantastic lengths in juggling with the money in the taxpayer's pocket to try to show that they could do it. But it could not go on for long.
The late Sir Stafford Cripps faced up to it with characteristic courage. In 1948–49 food subsidies reached £485 million, and he estimated that unless a limit were placed on them they would be £568 million in 1949–50. He said, in his Budget speech in 1949:Now that … cannot go on. We must call a halt, or we shall find ourselves in the ridiculous position of having to refuse to import much needed food because we cannot afford to pay the subsidy out of our Budget."—[OFFICIAL REPORT, 6th April, 1949; Vol. 463, c. 2085.]The significance of this decision to pass on the additional costs to the consumer was confirmed by the 1950 Budget, when the ceiling was fixed at £410 million and maintained at that level in 1951. So events drove the Government to admit defeat in the attempt to isolate this country from world price movements. They took the decision to pass on all price increases to the consumer.
But once the principle of putting a limit on the subsidies has been accepted there is nothing sacrosanct in any particular figure. All that food subsidies do is to give the taxpayers of this country—both direct and indirect—the unpleasant task of paying so many millions of pounds to the Exchequer so that in due course they can buy food at the same amount below world prices. The housewife might buy her butter below what it costs to produce it; she saves a few pence on her ration of butter. Her husband, however, pays the equivalent amount in Income Tax, in the tax on cigarettes, on beer—[Interruption.] There are many people paying Income Tax who support the party opposite although they would not like to admit it. I am going through the various taxes, direct and indirect, and I was re- 58 ferring to the taxes on cigarettes or beer, or the other indirect taxes.
§ Mr. R. J. Mellish (Bermondsey)
The right hon. and gallant Gentleman is making a case as to why food subsidies could not be maintained at the figure fixed by the Labour Government at £410 million Why was it that Lord Woolton and the present Chancellor of the Exchequer gave a specific assurance at the last General Election—only a few months ago—that they would not reduce the subsidies? If they said that then, why did they do it when they got into office?
§ Major Lloyd George
I am on my feet and I propose to reply to the hon. Member first. I quote:We should like to simplify the immensely complicated system"—
§ Major Lloyd George
From the book which the right hon. Member rather liked just now. It states:We should like to simplify the immensely complicated system operating at present and substitute for it methods which supplement the personal incomes of those most hit by living costs. Two examples of such methods are family allowances and differential rates of taxation.That is exactly what this Government have done. Never before has a promise been carried out in such detail.
§ Mr. Shinwell
I quote accurately from Lord Woolton's statement, taking into account the context. He stated:There's the story that the Conservatives would cut food subsidies. That isn't true. What we want to do is to get rid of the need for the food subsidies.Do hon. Members—[An HON. MEMBER: "What about warmongers?"] We are not talking about warmongers. Do not be irrelevant. It has nothing to do with the argument. Do hon. Members deny that Lord Woolton said this? Lord Wootton has admitted that lie said it.
§ Major Lloyd George
The short answer is that, whatever the right hon. Gentleman may read out, the point is that the real pledge was that nothing would be done about varying the subsidies 59 unless compensating advantages were introduced. Compensating advantages have been introduced, which was never done by the right hon. Gentleman's Friends when they were in office.
If I may proceed, I was making the point when I was interrupted that, while it is true that the housewife might get a commodity at so much less than the price of production, that has to be paid for by taxes, direct or indirect, in some form or other. It has been calculated that if one takes the average family of, say, a man, wife and two children, the subsidies were worth to them in those days about £33 per year, but if one person in that household drank a pint of beer and smoked a packet of cigarettes a day he paid in a year the whole of that sum in tax. Apart from the fact that the supplying of anything below the cost of production gives a completely false sense. [Interruption.] They have had a relief in the way we wanted to give it.
§ Mr. Douglas Jay (Battersea, North)
The right hon. and gallant Gentleman now seems to be enunciating a new doctrine, that food subsidies are wholly bad. Do we understand him to be contending that the present Government are against food subsidies altogether and that next year they will wipe them out entirely?
§ Major Lloyd George
I never said anything of the sort. I was answering an interruption. Perhaps the right hon. Gentleman did not hear it.
What an indiscriminate process the subsidy is at the present time. The food subsidies are shared out to rich, to the middle classes and to the poor alike. The supertax-payer gets his share of food subsidies. The best hotel—or the luxury hotel, if we call it that—gets its share of them. It gets its food at subsidised prices like everybody else.
It it not only the waste, in real and in administrative terms, which worries us. The collecting of over £400 million from the taxpayer for the food subsidies has helped to build up taxation levels which crippled enterprise and initiative throughout the country. Subsidies have obscured the difficulties which the country was experiencing in paying its way. Many of our people were misled into the feeling that we could enjoy a higher standard of living than we were earning.
60 Moreover, the food subsidies gave producers a feeling of insulation from their market. As food prices rose, the producers were saved from wondering whether the increases would have any effect on their total sales, since they probably felt that the Government would pay the subsidy anyhow. One of the most valuable aids to efficient trading, the fear of pricing oneself out of the market, was removed.
I cannot help but observe from my own experience that this arrangement seems to have encouraged many good men in the food trades, both here and overseas, to concentrate their energies on how best to justify their claim for increased costs to the Ministry of Food rather than on how to get their own costs down. That is just one way in which enterprise has been misdirected by this State trading.
Those are among the reasons which led, once we had discovered how precarious was the economic health of the country, to the decision to reduce the food subsidies below the level of £410 million which the late Government fixed. The Chancellor decided that the subsidies should be reduced to a rate of £250 million a year, but he did not fix a subsidy ceiling for 1952–53. The actual food subsidy bill for that year will depend upon the date on which the price increases are made so as to bring the subsidy down to a rate of £250 million.
Whatever our opinions may be about the usefulness and the economic merits of subsidies, we have to begin by recognising the limits to the possibilities of making changes. We have to go cautiously, because of the effect which sudden and large changes of prices may have on food consumption and indirectly on other aspects of our economic life. We wish to ensure that the consequences of the economic failures of the late Government do not hit unduly old-age pensioners, children and other social groups—[Horn. MEMBERS: "Oh."]—that phrase includes them all—about whom we all have some concern, I hope, on both sides of the Committee. The increases in food prices necessary to bring the subsidy down from an annual rate of £410 million to £250 million are being carefully timed and must be viewed not only against the substantial compensating benefits but also against the increase in wage rates and earnings to which I have already referred.
61 The increases in bread and flour prices had to be made to meet the normal increases which we could foresee at the beginning of the year in the cost of buying our food in 1952–53 including increases in the cost of home-produced food. This increase would have to be made in any case, to keep the subsidy down to £410 million, and had nothing to do with the reduction in the subsidy total. Apart from the increases in bread and flour, no increases were made before the Income Tax reliefs under P.A.Y.E. became payable, and the new rates of National Assistance became effective.
Then, on 15th June, the increased prices of meat and tea came into operation. The new milk prices will take effect on 1st July. I am holding back other increases which are necessary until the increased family allowances and retirement pensions, the last of the compensating social security benefits, are introduced and become effective in the Autumn.
This effort to synchronise the adjustments means that it will cost us more for food subsidies than if we had followed the procedure of the last Administration and let prices rise suddenly and steeply. By making the changes gradually, the food subsidy bill for this year—although we shall be down to a rate of £250 million—will obviously be more than £250 million. The revised estimates of the Ministry of Food for the current year will be available on 2nd July, that is, next Wednesday. I do not want to go into details about them, but since they will contain the estimated figures of the total subsidies for the year, I think the Committee will wish to know of them.
Although we shall implement the Chancellor's policy of getting the food subsidies down to an annual rate of £250 million a year, the subsidy bill for the financial year 1952–53 is estimated at about £310 million. Our decision to time these price increases in this way may also be assisted by some change in world price levels, which are already apparent. Most of the significant changes are in raw material prices, which I will leave to my right hon. Friend who is to wind up the debate.
My own Ministry has benefited modestly from a fall in freight rates. This time last year it cost about £9 to £10 per ton to carry sugar from Australia to the 62 United Kingdom. The current rate has fallen to about £4 10s. There are some foods, notably some types of oils, oil seeds, and most animal feedingstuffs, which have been falling in price. Unfortunately, my ability to take supply advantage of these changes is hampered by our balance-of-trade position. We cannot remind ourselves too often that if we are to have more food we must send more exports.
While we must all regret the economic difficulties, whether they be due to the late Administration or to long-term economic changes which have resulted in these—increases—[HON. MEMBERS: "Which is it"?] A little bit of both. I have tried to indicate where I thought the blame lay and I think I have made out a fairly good case—and while we must all regret that the causes I have mentioned have resulted in these increases of just under 5 per cent. in the all-items index since October, 1951, we must not try to exaggerate them. It would be wrong to over-estimate the effects of this increase on food consumption.
There are as yet no signs of any significant change in food consumption as a result of the price increases. The right hon. Member for Easington talked about the working man not being able to buy meat. The meat increase has hardly been on for a fortnight, and I should like to know of his researches in that period which show a clear picture of the result of the increases upon meat consumption. I have not seen any result through our administrative machinery; none at all.
The people of this country—let us face up to these facts—spent £670 million in the first quarter of this year on food consumed in their homes, including chocolate and sugar confectionery. They also spent nearly £200 million on tobacco. They spent £173 million on alcoholic drinks. That is in the first quarter of this year. They spent about £80 million in all on entertainment in that first quarter. That is not the pattern of expenditure of a people who are hard up against the cost of living. I am certain that, despite the increased cost of food supplies, there was no difficulty whatever in purchasing them. It is inevitable that we on this side of the Committee should be reminded of some of the things which the Opposition did. After all, they have had plenty of experience of the rising cost of living.
63 As I told the Committee on 15th May, the increase in the prices of basic foods which the Opposition made in little more than two years—that is from 1st April, 1949, to 31st July, 1951—averaged £250 million per annum; and they managed to give us an economic crisis almost every year. So they had the experience and the opportunity to reach the right conclusions even if they had not the courage to put them into effect.
Hon. Members opposite have tried their remedies with sorry results on prices, as I have shown. They have produced only higher prices. The way to lower prices is surely through efficient production, purchasing and distribution. We believe that private enterprise, taking its own risks, being responsible for its own costs, can in the long run do more to bring down the cost of production and distribution than all the restrictions of State trading and controls.
It is easy to understand why the Opposition decided to have this debate now: they want to place the responsibility for the present position of the country on the shoulders of Her Majesty's Government. They feel that sufficient time has elapsed since the election to make people forget where the responsibility really rests, and that is on the shoulders of right hon. Gentlemen opposite.
I wish to emphasize two points, in conclusion. Until last November the Opposition had been in office for six years with one of the largest majorities of this century. During that period they received by way of loans and gifts about £2,228 million, the overwhelming part of it in dollars. [An HON. MEMBER: "What did we give away?"] You gave some away, but you kept most of it.
§ Major Lloyd George
The fact is that of the £2,228 million—the right hon. Gentleman can deny it as much as he pleases—after a war, for the first time in our history, we received large sums of money. That represents nearly one-third of the bill for foreign food imports into this country, and the vast part of it was in dollars. Think what we could do with some of those dollars today. Despite the unprecedented assistance which that Government received, when they left office food rations were, in 64 general, no better than when they came in, and the cost of food had risen steadily until, by the time they left, it was 58 per cent. higher than it was before they came in.
§ Major Lloyd George
I have stated the facts and I am grateful to the Opposition for having given me an opportunity to do so.
§ 5.3 p.m.
§ Min Jennie Lee (Cannock)
There have been times when I have been embarrassed and distressed in listening to the right hon. and gallant Member. We do not mind when it is the Parliamentary Secretary, who is now rushing out for a cup of tea which he probably thinks he deserves. After all, every court is entitled to its jester. As the Parliamentary Secretary has made himself the cheap jack of the party opposite, it is fun when he makes the kind of speech that we can simply laugh at on this side of the Committee.
I repeat, however, that I have been distressed to the point of embarrassment at moments when the right hon. and gallant Gentleman was speaking, because it is sad to think that such a radical father should have produced such a reactionary son. We miss very much in this House another member of his family, and we shall be glad to see her back. But when she comes back here, I cannot possibly imagine that it will be to join hon. Members opposite. I think that the radical mood of the family is alive, but not in the right hon. and gallant Gentleman.
§ Miss Lee
One wondered at times while he was speaking if he was reading a brief which he had been too hot to study before he came to the Committee. There were moments when one wondered whether he meant what he said. For instance, someone had provided him with the obviously cheap points that the luxury hotels enjoy subsidised food and that the richest people enjoy it. What is the logic of that? Does he think it is wrong that they should have subsidised food? [HON. MEMBERS: "Yes."] The right 65 hon. and gallant Gentleman can probably reply for himself.
However, some hon. Members opposite say that it is wrong that luxury hotels should enjoy subsidised food, and no doubt that well-to-do people should not enjoy subsidised food. Have I still got the agreement of hon. Members opposite? If that is the case, does it mean that hon. Members opposite want to end all food subsidies?
The right hon. and gallant Gentleman was asked that question and he dodged a reply. [An HON. MEMBER: "That is not the point."] If the hon. Member has not got the point, and since it is too hot a day to hurry, I will take my time. Luxury foods and hotels ought not to be subsidised. Where does that lead us? To one of two conclusions. It could lead us to having no subsidies.
§ Miss Lee
It means, either no subsidies or a means test—in other words, anyone who wants subsidised food has to declare their income.
But what a cheat it all is, particularly when the right hon. and gallant Gentleman says to this Committee, "Of course if food is costing more, if we have cut down subsidies on food, we have made that good by family allowances and differential Income Tax." The right hon. and gallant Gentleman knows better. The right hon. and gallant Gentleman should know that in the case of a household with £20 a week to spend on running the home the Tory Chancellor of the Exchequer has been kind enough to give them £1 back.
That is a rough figure, because in some instances it is more and in some instances less, but I do not think anyone would quibble on that point. If one is going out with a shopping basket, £1 more helps quite a bit. It is true that it does not go very far if one has to get extra cheese outside rationed cheese, an extra bit of tinned meat, an extra bit of good quality fish and, in weather like this, people want fresh fruit and vegetables. If the right hon. and gallant Gentleman will ask his charming wife, she will tell him that £1 does not go far, but it helps.
Yet how cruel it is that, when a Tory Chancellor can hand back £1 to a family 66 with roughly £20 to spend on housekeeping in order to help them meet the little extra cost of milk and bread and so on, he is not handing back £1 to the family man earning £5, £6 or £7 a week who is paying no Income Tax but has to meet the higher cost of food just the same. The right hon. and gallant Gentleman knows those things, so why did he say what he did? He knows perfectly well that he was put up at that Box today to fill the undignified roll of a Tory "stooge."
I say that it is unworthy of him and that he knows better. The Prime Minister did not think it worth his while to appear on the Front Bench today—[An HON. MEMBER: "Nor the Chancellor."]—yet the Leader of the Opposition was here. Apparently a cost of living debate is not an important subject for hon. Members opposite. They come here in as reduced numbers as they possibly can, and they put up the right hon. and gallant Gentleman to bring forward arguments in which I am quite certain he himself does not believe.
§ Miss Lee
I have never fought any election or made any speech, advocating cheapness at any cost. Food can be too cheap, as can furniture and clothes. I have the honour to represent a constituency which is devoted to mining in one part and to agriculture in another. I would say to the colliers' wives at one end of my constituency, when the Housewives League was telling them that food was too dear—I wonder where that dear old League is now. I wonder whether if we were to look under the benches opposite we would find any of its members.
§ Mr. C. S. Taylor (Eastbourne)
The hon. Lady was saying that the Prime Minister was not here, but there are two former Ministers of Food in the Opposition and neither of them is here. Where is the responsible right hon. Gentleman on the Opposition side?
§ Miss Lee
The difference between the hon. Gentleman's side and ours is that ours is adequately manned even when our Front Bench is not here. But even this afternoon our Front Bench has been far more adequately manned than the Government Front Bench. I simply repeat, since the attention of the Committee has been drawn once again to that 67 point, that obviously this is not an important subject of discussion for the Government because neither the Prime Minister nor the Leader of the House is present. But it is a much more important subject for us.
The Housewives' League was extremely busy when we were the Government, but it has apparently finished now.
§ Dr. Barnett Stross (Stoke-on-Trent, Central)
May I interrupt my hon. Friend? It would not be correct to say that the Housewives' League is no longer altogether active. The League is at present interested in the effect of agenised flour upon human beings. Many of them believe one effect is to produce forgetfulness and loss of memory. Perhaps this explains why the Government has so soon forgotten its election promises.
§ Miss Lee
I am very grateful to my hon. Friend who is an expert on every subject on which he speaks. I have an idea about some members of the Housewives' League. May be they have gone abroad or are on holiday, or may be they are going to come back and tell us how much better than ours is every other country. If the Government continue in their present form it only requires food to be a little more expensive and for there to be a little more unemployment for them to be able to distinguish themselves by abolishing rationing altogether. Would it not be wonderful to abolish rationing and to have plenty for those who have lots of money with which to buy food because those who are poor can no longer afford to buy their fair share?
§ Miss Lee
As soon as the war ended, we had Members coming back to the House telling us that Belgium was a paradise and that its shops were full of goods. Then it was Italy which was the paradise. Indeed, every other country was a paradise. They had fat steaks and rich foods, and everything one could wish for. But we as the Government had to explain that although there might be so much glamour in the foreground abroad we had just that extra bit of security and comfort in the background. The people were not so afraid because, as I say, we were concerned about the standard of living.
68 When I was interrupted, I was saying that I had miners at one end of my area. I would say to their wives, "Of course, you want cheap food, but do you want food so cheap that you are going to give starvation wages to the agricultural workers?" To the agricultural workers I said, "Of course, you want cheap coal"—and the hon. Member opposite did his little bit of mischief there—"but do you want your coal so cheap that the miners will have to receive starvation wages?"
I do not apologise to hon. Members opposite for talking such elementary economics, because, apparently, they do not understand. If we talk to any sensible audience outside the House they understand that the important thing is the standard of living. They want fair prices for agricultural and industrial commodities.
§ Mr. Nabarro
Would she mind telling me, because I am particularly interested in all matters concerning mining, of what piece of mischief in connection with coal production I am guilty.
§ Miss Lee
I cannot give way again because this is a food debate, not a coal debate.
What were we trying to do when we were the Government? We were trying, and succeeding, so to regulate taxation, children's allowances and the cost of food and food subsidies that every family in the land should begin to have at least the essentials guaranteed. That is already no longer the situation. It is quite true that while food is more expensive there are many lines in clothing and furnishing textiles that are cheaper.
Why are they cheaper? One reason is that as soon as food prices rise the family has to do without those little bits of 69 clothing and household furnishings. If we go to the great department stores, we find that firms like Lewis's with moderately expensive lines are seeking to cut down wages, which is a very "helpful" thing to do. It is a dangerous thing to be sarcastic in the House so I had better put that right and say that it is a very foolish thing to do.
The cheaper the store, the better is their business. It is the cheaper lines that are doing better. Why is that? The reason is that the first line of retreat is to go from the more expensive commodities which are not always better, though often better and last longer, to the cheapest pair of shoes or garment that can be got in which to carry on. As all working-class folk know, if one cannot afford the initial outlay one very often has to pay for it later on.
I hope we are not going to degenerate into what we see in many parts of the world today, the system which hon. Members opposite admired so much when they were on holiday abroad. Of course, all of us who can manage it like a holiday abroad sometimes, but it was particularly nauseating that those who could afford holidays abroad and who came back and told us how wonderful everything was for people in other countries failed to make clear that there were goods in the shop windows in abundance and no rationing system because there were millions of people who could not afford to buy even the most modest quantity. We are going in that direction at the present time.
I would never dare address the Committee as an expert on agriculture. I have to listen humbly and carefully to those hon. Members who know what we can do to increase our own food production here. But anyone using his eyes when travelling around Great Britain cannot help being struck by the amount of good land which is still being abused in this country. I hope that the Minister of Food will co-operate with his colleague the Minister of Agriculture to see whether we are not having too much fancy capital put into the land by fancy people who are not really farmers. The result is that men of country stock are not getting a chance to lease a farm and are not able to get land for themselves. If the Minister will go to his own part of Wales he will find—
§ Captain Christopher Soames (Bedford)
Is the hon. Lady inferring that, on the whole, land in this country is at present over-capitalised?
§ Miss Lee
I am inferring that at the present moment there are parts of the land of this country which may be undercapitalised, in which case it is the business of the Government, or, maybe it is badly farmed. But the external evidence which strikes a person like myself is that there is far too much good land in this country which is still being neglected. I was about to say that in the main—and I speak with diffidence—the very large and prosperous farmer has been getting too much public money while a great many marginal farms have not been given as much help as they needed. I am confining myself merely to what I see and, even in Wales, I see large tracts—not of high mountain peaks, but good fertile ground—covered with bracken.
I hope that in considering the cost of living and in particular the price of food, we shall do even more to develop our own production, because all over the world people now want to eat. We shall never again get into the situation in which we could sell expensive industrial goods and in return get good cheap food. I do not stress that elementary point because we are all agreed on it. I think the logic of it is that we have to do much more to grow food for ourselves in this country. In the meantime, until we reach that destination, do not mock poor people—for whom the main item week by week is buying food—by telling them that we have introduced a differential Income Tax rate which covers the cost for them.
My last point refers to the old people. Before I had intimate personal knowledge of the care of old people, I foolishly assumed that perhaps the older we got the less we needed in nourishment. I now think many people go through three stages. In the middle years they may need less, but, as they get older, it is just that extra bit of protein, that extra bit of food, that rich nourishing diet, which can make all the difference. We are not only mocking the family man and woman with young children by pretending that they are not suffering from increased prices, but we are mocking old people because old people in Britain today cannot get the good mixed diet they 71 ought to have at the present level of prices.
We have not reached the end of the road yet, but the direction in which we are travelling is one which fills many of us with anxiety and dismay. We say that in good times and in bad times we ought so to organise our fiscal system and the distribution of our food resources that at least we do not do as now, place the heaviest burden on the poor family groups and old people.
§ 5.25 p.m.
§ Mr. C. N. Thornton-Kemsley (Angus, North, and Mearns)
It is always much more pleasant to agree with people than to disagree. Therefore, I think many of us on this side of the Committee found ourselves happy at least to agree with the hon. Member for Cannock (Miss Lee) when she stressed the necessity of an increase in our agricultural production.
When she was speaking, however, some of us who know a little about agriculture felt that perhaps it would have been better if, during the time the Labour Party were in office, it had not been a fact that 50,000 acres of good agricultural land went out of production every year and that the impetus of our agricultural programme had not been stopped. In fact, in the last two years of Labour rule agricultural production declined. But this is not a debate about agriculture although, of course, home food production plays a necessarily important part in the cost of our food supplies.
I thought, during the speech of the hon. Lady, of an article in a journal—not "Tribune" but a journal called, I believe, the "Labour Woman"—which said recently:Fortunately, the prices of clothing, footwear and household textiles have been falling recently, and there is every indication that this process will continue. To some extent, therefore, rising food prices are being offset by reductions elsewhere.Let us get down to the realities of the situation, because we all want to see the prices of food steady and coming down. What are the realities of the situation? The first is that for 12 years there have been continual shortages throughout the world, including this country, of essential foodstuffs and for the last two years world food prices have been rising. There is no disposition to dispute that in any informed circles of which I have any knowledge.
72 The right hon. Member for Bradford, Central (Mr. Webb), the former Minister of Food, would certainly not have disagreed. He said in a speech in his constituency on 9th October, just before his Government went out of power:No Minister of Food coming back to the job after the Election can avoid the stark inescapable facts, and in the short run nobody can make any appreciable difference in the amount of food, the variety, the price, or the general organisation, if he is going to act face to face with realities.After the General Election, when he found himself in Opposition—just a month after that first quotation—he said in the House on 9th November, 1951:Our problems are inherent in our situation as an over-populated island, which cannot ever hope to feed itself, and must now compete for diminishing exportable food surpluses with the growing demands for food right across the world;"—[OFFICIAL REPORT. 9th November, 1951; Vol. 493, c. 502.]That was not the kind of thing we heard from the right hon. Gentleman the Member for Easington (Mr. Shinwell) Most of us were a little surprised when we heard that he was to open this debate—as he is a stranger to all questions of food—instead of the right hon. Member for Bradford, Central. But, perhaps it is not so surprising because the right hon. Member for Easington comes without this background which I have tried to indicate in the quotations I have given.
The right hon. Member for Easington either did not trouble to inform himself of these harsh realities, or he has deliberately distorted and suppressed the facts to gain a transient party advantage from misfortunes we all share and to which Socialist policy, as I shall shortly show, has largely contributed.
How did the Socialists meet the situation with which they were faced? They inherited a war-time system of the procurement and distribution of food and an administrative organisation which, although it may have been adequate for the exigencies of a blockade economy, is not necessarily so for the wholly different circumstances of peace-time.
What were the essentials of that system which they inherited and in which they persisted? First of all, one Ministry, the Ministry of Food, bought the whole of our supplies of imported and home-grown food, controlled its distribution and fixed the retail price, whilst, at the same time, 73 another Ministry, the Ministry of Agriculture, fixed the growers' price. Any difference between the fixed growers' price of the Ministry of Agriculture and the fixed retail price of the Ministry of Food had to be borne by the unfortunate taxpayer. It was a system which the "Economist"described asA system which is hardly calculated to stimulate realism and efficiency in the official controllers.Yet for six years, whilst they held the reins of office, the Socialist Party made no attempt whatsoever to alter the cumbersome system of controls which this organisation made necessary. Moreover, they continued to pay subventions to private traders who, because of State buying and controlled distribution of food, were denied the opportunity of the full exercise of their skilled services by the Socialist Government's obstinate clinging to the rigidness and roughness of the wartime system of distribution with it extensive elaboration of controls and its denial of consumer choice.
The high-water mark of fatuity was reached when they gave millions of pounds to retailers, who had not the opportunity of exercising their accustomed skill, because they were unable to receive meat which for nine months the Socialists could not get from the largest of our pre-war suppliers. I think they were quite right to go on with that system then, but how foolish that, although they had been in office for four or five years, they should persist for so long in such a system.
At any time from 1946 onwards they could progressively have handed back the procurement of essential items of food, including meat, to the private buyer, but, instead of that, they persisted in the system of State trading. Successive Ministers of Food from Sir Ben Smith, who loomed so largely in our discussions in the House five or six years ago and of whom we hardly hear anything at all now, the right hon. Gentleman the Member for Dundee, West (Mr. Strachey) and the right hon. Gentleman the Member for Bradford, Central all held the office of Minister of Food during the Socialist Administration.
In passing, neither the right hon. Gentleman the Member for Dundee, West nor the right hon. Gentleman the Member for Bradford, Central has been 74 in the Committee this afternoon. What a remarkable thing that during a debate on food prices neither of the two Ministers of Food in the previous Administrations have appeared for one moment. I beg the Committee's pardon, but I think the latter statement is wrong. The right hon. Gentleman the Member for Dundee, West appeared for a moment in the Committee, and that was to ask for tickets of admission at the Serjeant at Arms' Chair. That is the only appearance we have had from that right hon. Gentleman, and we have not seen at all the right hon. Gentleman the Member for Bradford, Central.
These Ministers of Food over a period of six years refused to depart from a system—and if I may I will continue to use meat as an example—under which the butcher had to take what he was given and the housewife had no choice whatsoever of the type or variety of meat that she could buy.
§ Mr. Thomas Williams (Don Valley)
Will the hon. Gentleman tell us what change has been made in the procurement of meat since this Government took office; and, secondly, what choice the housewife has today?
§ Mr. Thornton-Kemsley
The right hon. Gentleman will perhaps do me the honour of listening to the argument which I am unfolding. If he does, he will see that I am going to discuss the points on which he has asked me questions.
Time and time again my hon. Friends and I, when we sat on the opposite side of the Committee, made speeches the theme of which was that Government purchases and State trading in the procurement of meat not only led to bitter recriminations between countries that ought to have been friends, but it gave no incentive to the producer to produce the type, the quality or the quantity of meat that the consumer wanted, and that the best meat was reserved for the private trade while the Government contract only got the scrapings of the barrel. The reply always given by the Government side to the arguments which we advanced was, that that might be so but State trading at any rate gave cheaper supplies.
§ Mr. Thornton-Kemsley
That is what we were told. The right hon. Gentleman's friends always said that.
§ Mr. Thornton-Kemsley
We were told that the one advantage of State trading was it enabled us to buy our meat cheaper. I doubt very much if that is true in the long run, and let me say why. Private traders are far more sensitive to demand and supply. They are far more flexible than are Government buyers, with their long-term contracts and their blanket prices fixed at least a year ahead. The Government buyer is up against the difficulty that he has to strike a price which meets, on the one hand, the consumer's ability to pay; and, on the other, the producer's willingness to produce.
The right hon. Gentleman the Member for Bradford, Central saw that quite clearly after he left office—I do not know if he saw it when he was in office—as is shown in a broadcast which he made on 21st January in the Home Service. I took the trouble to provide myself with a copy of the broadcast, and this is what the former Minister of Food said:At the same time there is a problem here, this problem of cheap food. Now, certainly we can't have cheap food at the expense of the producers. Quite frankly, the ordinary housewife in this country who has got a very difficult job must face the fact that she's not going to get any food at all, either from home producers or dominion producers or overseas producers if she's not prepared to give them a reasonable reward for the work they do in producing that food. You're not going to get cheap food any more in that way. That's the fundamental fact we've got to face. …That is the right hon. Member for Bradford, Central. What a pity he did not take more action on that at that time.
May I just make a further point on this question of cheaper food? I see that Mr. McEwen the Australian Minister of Commerce is quoted in "The Times" on 21st January as having said that since the United Kingdom Government have established a monopoly in imports they have screwed the price of Australian foodstuffs down to levels unprofitable to the producers.
Let me give one more example, the example of Eire. Eire has recently sent cargoes of beef to the United States Forces in America. She has sent cargoes of beef to the United States Forces in Germany; and, most remarkable of all, she has sent 76 consignments of beef on the hoof by ship from Dublin to Liverpool; by train from Liverpool to Folkestone, and by air from Folkestone to Italy, where it is fetching higher prices than we were able to give, even after paying all the expensive costs of transport. At the present time a company has been, or is about to be, formed in Dublin to develop the carcass meat trade. I understand it is erecting chilling plants, or a chilling plant, in Dublin.
§ Mr. E. Evans
May I ask the hon. Gentleman what the Government have been doing these last nine months to let all that meat go to ruin? They have been in charge all the time.
§ Mr. Thornton-Kemsley
That is a very germane point, because some of this happened in the time when the hon. Gentleman's party formed the Administration. But why has it happened? I will tell the hon. Gentleman, not in my own words, but in the authoritative words of the "The Times Agricultural Review," which says:The only rule that Britain needs to follow in order to retain her position as most favoured customer "—that is, with Eire—is not to try to drive too hard a bargain in the matter of prices. … The bulk of the Irish exportable surplus will continue to cross the Irish Sea so long as the price Britain offers is considered fair.
§ Mr. Thornton-Kemsley
We are in power and my right hon. and gallant Friend—this is no secret—has been holding conversations with the leading meat importers with a view to handing back to the trade as soon as possible.
§ Mr. Thornton-Kemsley
I hope that my right hon. and gallant Friend will be successful.
I have listened to a great many speeches made by my right hon. and gallant Friend since he took office and I have read every speech to which I did not have the good fortune to listen. On the subject of the meat trade and private enterprise, I think he advances three propositions. I hope that I am not doing him an injustice. He says, first, that the only hope of more and better meat lies in a return to private 77 enterprise. Secondly, he says that while food is scarce it must be distributed fairly, and thirdly, that while there is rationing and price control it would be difficult to allow the private purchase of meat. Here is a vicious circle and there is no need for us to blind our eyes to that. But someone has to break out of that vicious circle at some time. Unless we do so we can have no hope of more and better meat.
What about costs? I am not afraid of costs, because I believe that if the trade was handed back to private enterprise exactly the same thing would happen as before the war, that the more expensive cuts would subsidise the cheaper cuts. That did not require any Government planning. It just happened through the normal operation of competitive trade.
I would refer to the very recent example of the importation of poultry and rabbits. When the Socialist Government were in power they did one good thing. [HON. MEMBERS: "Hear, hear."] Let us be fair. In June, 1950, they decontrolled the poultry and rabbit trade. Some of their supporters said, "This is awful. The price will rocket to the sky, and supplies will disappear." What happened? Ever since we have had adequate supplies at reasonable prices. The wholesale price of rabbits has been 33 per cent. below the figure for 1951.
I have tried to show that there would be more food if the Socialists had departed from the wartime procedure of purchase and distribution, and it follows clearly that if there had been more food it would not have been so expensive.
I turn to one other important respect in which the position has been worsened by the Socialist policy, that of the food subsidies. The intention of the food subsidies, as everyone knows, was to keep down the cost of living. Quite clearly, they did nothing of the kind. In spite of the enormous expenditure on food subsidies between 1945 and 1951 the purchasing power of the £ fell steadily.
I will give three figures at three-yearly intervals to indicate the trend. In 1945–46 food subsidies stood at £265.5 million, and the purchasing power of the £ was 20s. Three years later, in the financial year 1948–49, food subsidies were £484.4 million, and the pur- 78 chasing power of the £ was down to 16s. 11d. Three years later, in 1951–52, the food subsidies were £410 million, and by October, 1951, the £ was worth only 14s. 3d.
My right hon. Friend has quoted the late Sir Stafford Cripps on the rise in the food subsidies from £485 million to £568 million from a speech which Sir Stafford Cripps made in this House on 6th April, 1949. I should like to give another quotation from that speech. He said:Now that just cannot go on. We must call a halt. … Prices have got out of all relationship with realities."—[OFFICIAL, REPORT, 6th April, 1949; Vol. 463, c. 2085.]At the beginning of 1945–50 food subsidies were £424.8 million and to have kept the price of food stable at that figure throughout the year would have meant another £145 million. What happened? The Labour Party added that £145 million to the cost of food, and retail food prices rose between 11 per cent. and 12 per cent. in 12 months.
As my right hon. and gallant Friend reminded us, the late Chancellor of the Exchequer fixed the food subsidies, last year, 1951–52, at £410 million. But they were running at £20 million above that for five months before we took office. Because of that, this Government had to increase the price of cheese by 10d. a 1b., bacon by 10d. a 1b., and milk by 1d. a quart. If action had been taken by the Labour Government at the proper time, the rise in prices would have been far less.
§ Mr. T. Williams
I am sorry to interrupt the hon. Gentleman twice during his speech. It is not often that I do that. Having given the figures for the two or three periods about the increase in cost of food and the fall in the value of the £, will he now tell the Committee what the changes were in the cost to this country of imported food between 1945 and 1948 and 1948 and 1950, and also the increase in the prices we had to pay to our own farmers because their costs of production had increased?
§ Mr. Thornton-Kemsley
I cannot give them. I have not the resources of a Government Department. I can only say that we had to increase the subsidies to our own agricultural industry and it was quite right to do so.
79 The point I was making, and I make it again, is that it is misleading and dishonest, in face of these figures and others that have been given, to infer that retail food prices started to rise with the advent to power of a Conservative Government. They rose more steeply in the first half of 1951 than in the corresponding months of this year. I will quote one figure once again, because it is worth repeating. While the Socialists were in power the cost of food rose by 58 per cent.
I have spoken for too long already, but I want to recapitulate. First, for over six years the Socialists failed to tackle two war-time features of our food policy which are fundamental to a return to a sound economy and ultimately to our chance of securing adequate supplies at fair prices. They perpetuated both the system of Ministry of Food buying and control of distributing and of retail prices, and the system of food subsidies.
These heavy and indiscriminate subsidies on food created in our people a dangerous unawareness of rising food prices. It has been left to a Conservative Government to make a start along the road to a freer economy and, at the same time, to temper the wind to the shorn lamb by devices such as family allowances, the increased social benefits and the reduced Income Tax. While the Socialists held the reins of power the cost of food rose steadily without any compensating advantages. It does not lie in their mouths to censure us upon this account.
§ 5.54 p.m.
§ Mr. William Blyton (Houghton-le-Spring)
The hon. Member for Angus, North and Mearns (Mr. Thornton-Kemsley) referred to the question of bulk buying. I asked him to give way because I wanted to know if he means to abolish entirely the bulk buying agreements now in existence. Of those agreements 53 are with the British Commonwealth. They are long-term agreements which give guaranteed prices and markets to the Commonwealth. Am I to understand that it is his philosophy that all these ought to be abolished?
§ Mr. Thornton-Kemsley
I gladly answer, since I am challenged. I never disagreed with bulk buying. I agree that all good traders buy in bulk when they 80 get a chance. Certainly, I do not disagree with long-term agreements which give us advantages in the Empire family. What I object to is State-to-State trading.
§ Mr. Blyton
Then I wish to ask the hon. Gentleman how he would negotiate for those commodities which are in short supply, such as meat, if a State will deal only with a State? I have heard a lot about merchant venturers going out and getting us all the red meat which Lord Woolton promised, but I am given to understand that the meat trade does not want to go back to the pre-war position.
§ Mr. Thornton-Kemsley
Since the hon. Gentleman has asked me another question, I would say that it is not a fact that the countries with whom we trade will deal only with State organisations. No doubt the hon. Gentleman was referring to the Argentine. The Argentine is dealing with other countries through private traders. Only in respect of this country is the Argentine dealing through the State trading organisation. The hon. Gentleman said that the trade did not want to go back to the pre-war position. Of course it wants to go back. The meat traders want to get back into the markets because they know that they would do better than the Government are doing at present.
§ Mr. Blyton
That is contrary to the information which I have, and I have talked to many men who are "in the know" in the meat trade. But I will leave that point because the hon. Gentleman has now gone rather away from the argument about bulk buying agreements.
§ Mr. George Jeger (Goole)
On the question of the purchase of Argentine meat, I should like to point out to my hon. Friend that during the last six months we have repeatedly asked the Minister of Food to say who is negotiating the new agreement since the old one expired on 22nd April. We have been told repeatedly that Her Majesty's Ambassador in Buenos Aires is negotiating the new meat agreement, and not the private traders. Therefore, I should think that the hon. Member for Angus, North and Mearns should address his remarks and strictures to his own Government and to his own Minister of Food, who seems to be departing from what he alleges are Conservative principles and 81 supporting the principles laid down by the Labour Government.
§ Mr. Blyton
If I may get on with my own speech, I would point out that I listened attentively to the Minister of Food. If he delivered such doleful speeches in Newcastle then we should surely win the only remaining Conservative seat in that City. It is no good the Minister or anyone else thinking that he can go to the housewife who is spending her husband's wages at the week-end and talk a lot of mumbo-jumbo about the cost of living index figure. I believe that the Minister of Food would get a big surprise if he talked to working-class people on a Saturday morning in the Biggmarket in his own area.
These cost of living questions must be discussed with two considerations in mind. First, what were the promises of the party in power to the people of the cofintry at the Election, and what has been their performance'? Secondly, what is to happen when we have the trade unions seeking increases in wages amounting to £300 million due to the policy of the party opposite? These issues must be faced.
I remember, during the last six years, seeing the fur-coated ladies in Central Lobby calling themselves housewives and harrassing the Labour Party Members. They threatened to burn up their ration cards and heckled the Minister of Food, at that time my right hon. Friend the Member for Dundee, West (Mr. Strachey), at every meeting which he attended. From the day of the last Election they have vanished into thin air. Whether they are in hiding, waiting until such time as we come back to power in order to emerge again, or whether they have had instructions from the Tory Central Office to keep quiet, one cannot tell. There is one thing we are assured upon, and that is that their absolute quietness at present proves that they were in no way non-political when they were active at the time when the Labour Government was in power.
At the last Election Lord Woolton said quite definitely to the people of this country that it was a Socialist trick to say that, if they were returned, they would slash the food subsidies, at the same time as he was promising the people more red meat. We know what they have done. On top of this, there were the import cuts, 82 which are equivalent to 3d. per person throughout the country of non-rationed meat which was available before the Election.
So much for the better diet. There have been cuts in the imports of meat, canned fish, fruit and vegetables, fresh fruits, cakes and confectionery. At the same time, we have been told by the Minister of Food in the recent debate that butter is now to be regarded as a luxury. It seems that it will be a case of butter for those with wealth and margarine for those at the bottom of the scale.
What about the cost of living? Flow do their actions compare with their promises? During the first three months in which they were in power, they increased the monthly rail fares by 2s. in the £. They increased the price of coal by 6s. per ton. Furniture prices were increased by over 10 per cent., petrol was put up ¼d a gallon, cheese went up by 10d. per 1b., milk by 1d. a pint and flour by½d. per lb. Not only that, there were increases in the prices of semolina and sago, tapioca, tinned vegetables, non-rationed cheese and many other things.
That was followed by the Budget, which put 1½d. more on the loaf of 1¾ 1b., and they increased the price of a stone of flour by 1s. 5½d. per stone. They increased meat by 4d. per 1b. and put another 1d. per pint on the milk, while the seasonal 1d. per pint did not come off. Tea has gone up in price because the subsidy has been abolished, and there are increases yet to be announced on butter, cheese, fats, sugar, bacon and eggs. Everyone now has to pay 1s. for a prescription when they fall ill. On top of all this, there is the 7½d. per gallon which has been put on the price of petrol, which is bound to find its way on to the prices of the goods which the people buy, because the transport charges for carrying the goods will go up. Then, we have had the farm Price Review, and, shortly, this will be having its effect upon the cost of living.
It is this background and history which has determined the trade unionists of this country to seek increased wages to meet these increased costs imposed on the family purse. It is no good the Chancellor of the Exchequer taking away the only cushion there was for the trade union leaders to restrain their members, which he did by slashing the food subsidies and 83 giving to the well-to-do £180 million in Income Tax, thereby taking away the only leg on which a trades union official could stand when trying to restrain his members on the question of the increased cost of living.
The Minister has talked of the benefits of the abolition of subsidies. Why did he not tell the Committee that much of the increased benefits in social insurance are to be met by increases in the cost of the insurance stamp, which constitute another additional burden imposed on the cost of living of the people. How the old age pensioner is going to fare by the end of this year I do not know, but it is estimated in trade union circles that, by the end of this year, the cost of living will have increased by at least 5s. per head of the population. It is because of these terrible figures with which they are faced that the trade union movement, quite rightly, has had to demand increased wages to meet this new onslaught on their members' standard of life.
What is the effect of all this? I often wonder whether it is the deliberate policy of the Government to create a margin of unemployment that will be a corrective on the trade unions in seeking to push forward their applications for wage increases such as are now being demanded as a result of the Government's policy. Are we to see the Government this year asking the trade unions not to press wage claims, and are we to see the Conservative Party telling employers not to grant increases in wages because of increased costs that have to be faced?
If that is the policy, and I am very suspicious that it is, at the end of this year there will be industrial strife in this country. It is because I feel that this is such an important problem that we are facing today that I would like some declaration from the Financial Secretary to the Treasury as to what the policy of the Government is going to be, in the light of the facts which I have brought to their attention.
We have unhappy memories. When the Tory Party put up prices after the First World War, we remember our experience of what they did then, and we know how prices were inflated. Some people believe that the same situation is developing now. I am wondering whether what we are now seeing is the same kind of policy as we 84 saw in 1920, which led to such disastrous years in the 30's.
Therefore, I wish to conclude by saying this. What we have given to the pensioners is not good enough. How they will live by the end of this year, when costs are going up against them, as I have already indicated, I do not know. As for the trade unions, they will fight for their members, and the Front Bench opposite ought to remember that, when we have working women demanding from their husbands more wages to meet the increased costs which they have to pay, it is then that we get the upsurge in the trade union movement which will make it impossible for national leaders, who want to do all they can towards restraint, as long as that is possible, to prevent the pressing of the wage demands of their people.
During the last week, I have been among many working-class people in my own area and in the big town of South Shields, and I have listened to them and talked with them. Over and over again, they have told me, these workers in pit, factory and shipyard, that the urge comes to them from their wives every week to take home more wages to meet the increased prices which their wives have to pay in the shops every Saturday.
I will finish by giving a warning to the Government that they should not tell employers to refuse wage increases to men who are seeking them, but rather that they should go back to the sound policy of subsidising foodstuffs and thereby giving the trade union leaders some leg on which to stand in an attempt to get through our economic difficulties with industrial harmony rather than industrial strife in the period ahead of us.
§ 6.10 p.m.
§ Mr. W. R. A. Hudson (Hull, North)
I do not intend to follow the hon. Member for Houghton-le-Spring (Mr. Blyton) except in one particular. If he reads in HANSARD tomorrow the speech made by his right hon. Friend the Member for Easington (Mr. Shinwell) in opening the debate, neither he nor any of his colleagues on that side of the Committee will ever again be able to deny that it was that party which first cut the food subsidies—and they did it without offering any compensation whatever such as has been included in our Budget this year.
85 I was rather interested in some of the things that the right hon. Member for Easington omitted to say. He omitted, for instance, to refer to any of those indirect influences on the cost of living, but not on the cost of living index, such as, for example, the £35 million worth of canned ham at extraordinarily high prices which was brought into this country instead of meat. If that £35 million had been spent on meat, we should have got a good deal more meat. Nor did the right hon. Member mention that it was his Government that was instrumental in bringing sugar and fat into the country, at astonishingly high prices, as a mixture instead of bringing in the sugar and the fat at the reasonable prices at which they could have been imported. I am very glad to know that our Minister has taken that matter well in hand already.
I must, of course, declare an interest in this matter. It is well known, I am sure, to my hon. Friends on this side that I am in the food trade. In that trade I am no advocate of high prices, because there is no greater deterrent to expanding and increasing trade than high prices, which ultimately lead to stagnation. There has been no greater contribution to keeping down the cost of living than the vigorous and healthy competition within the trade itself. That is a matter of trade history.
The burden of the Opposition's case is that prices are high and that they have increased rapidly during the recent months when we have been in power; and they claim that we are, therefore, responsible. But they have made no reference whatever to their own responsibilities in this matter. Are prices really high, or do they only seem to be?
§ Mr. Hudson
It is my contention, as I shall demonstrate beyond doubt, that in relation to wages, our prices of food are extremely low. [HON. MEMBERS: "Oh."] That may be quite a surprise to some hon. Members—
§ Mr. Hudson
We are in this position today largely because of the foolish 86 policy pursued by the party opposite during the last six and a half weary and dreary years.
§ Mr. G. Jeger
If the hon. Member thinks that prices are not too high, why did he spend a considerable time eight months ago, together with the rest of his party, in promising to bring down those prices?
§ Mr. Hudson
I am ready to accept that challenge, and I shall demonstrate to the hon. Member exactly how we shall bring down the cost of living. We have already made a very good start.
We are in this position today largely because of the policy that has been pursued by hon. Members opposite—an ignorant and arrogant policy, ignorant because they did not know what they were doing, and arrogant because they thought they could stem the tide of world events. No country, let alone this country, can afford to stand out against the world economy as the party opposite tried to do.
It is because we have wet-nursed the people of this country by the subsidies that today they are saying that prices are high when, as I shall show in a moment, they are low. Let us look at some prices, In September, 1939, the price of home-killed beef was: ribs, 1s. 4d.; in June, 1952, it was 2s. 4d. For thin flank, it was 1s. in 1939, and is now 1s. 6d. British mutton: legs, is. 6d. then, 2s. 10d. now. Canterbury lamb: then, 1s. 4d.; now, 2s. 8d.—and all those prices are with the bone in. I say that for a particular reason. In 1939, bread cost 9d. for 4 lb. Now, the price is 1s. 5¼d. Danish butter: then, 1s. 3d.; now 2s. 6d. Margarine, then, 9d.; now 1s. 2d. Milk, 7d. then, 1s. 1d. now. Tea, which in those days cost from 1s. 8d. to 3s. 8d., now costs from 3s. 8d. upwards. I want to direct the attention of the Committee to the fact that of those prices, only two have doubled and all the others have increased by considerably less than 100 per cent. since 1939.
What has happened to wages? It is very difficult to produce a calculation, but I am giving a very modest estimate when I say that rates of wages have increased two and a quarter times—and that is an understatement.
§ Mr. Mellish
I am following what the hon. Member is saying. He is saying 87 that wage rates have kept pace with food prices, but the figures he is using relate to a time when the Labour Government were in office. Since then the Tories have been in office, and in my constituency, for example, we now have considerable unemployment. Men who before were earning £8, £10 or £12, are now getting only £4 8s., which is the Assistance level. How does the hon. Member relate his remarks to those people?
§ Mr. Hudson
I shall be very glad to deal with what has happened since the Tories came into power.
Wage rates, at a modest estimate, have increased by at least two and a quarter times. Actual earnings, however, are considerably greater, because the basic working hours are fewer. It can be shown that wage earnings have increased by no less than 165 per cent.; in other words, they are much more than two and a half times what they were in 1939. In my own trade, the top rate basic wage of a male grocer's assistant, which in 1939 was 55s., is now 120s., which represents an increase of 118.18 per cent. The top rate for women has gone up from 34s. to 86s. a week, or an increase of 152.94 per cent. Those are the basic rates; and, as I have said, earnings are considerably higher because basic hours are very much lower. In fact earnings have increased by 165 per cent.
§ Mr. Hudson
I am sorry, but I cannot give way any more. To argue about food prices in relation to the cost of living is entirely wrong. It is a fallacy which arises from the fact that during the last six and a half years the public have been protected or have been deceived as to the real cost of food.
§ Mr. Hudson
No, I cannot give way. I want to deal with the point raised by the hon. Member for Bermondsey (Mr. Mellish), who wanted to know what had happened since the Tory Party came into power.
§ The Temporary Chairman (Mr. Frank Bowles)
Order. The hon. Gentleman must resume his seat, or otherwise he must leave the Chamber.
§ Mr. Hudson
It is well known that in 1947 an entirely different basis was adopted for the calculation of retail prices and I will not go back beyond that date. Taking 100 in June, 1947, the average of wages in June, 1948, was 106. In October, 1951, it was 122—an increase of 16 points. Taking the retail prices of all items at 100 in June, 1947, the 1948 average was 118. In October, 1951, it was 129—an increase of 21 points.
It is absolutely clear from those figures, which are taken from the Monthly Digest of Statistics, that the advantage which wages admittedly had over prices at the end of the war was being steadily eradicated during the period of government of hon. Members opposite. Since then there has been a rise of six points in both wages and retail prices up to the end of April, 1952. In other words, prices have advanced only at the same rate as wages during the last few months while we have been in office.
§ Mr. Hudson
Reference has been made to the prices of food abroad. It is worth having a look at some of the prices in England and abroad. Butter costs about 6s. a lb. in France and sugar 1s. 1¾d. Bread, which costs 4d. here, costs 8d. in France. Coffee costing about 5s. a lb. here costs 6s. 6d. there, and currants, which are 1s. a lb. here, cost 1s. 8d. a lb. in France. I believe it is an understatement to say that rates of wages are no higher in France than they are here.
I think I have said sufficient already to indicate that the prices of food in this country in relation to wages are still extremely reasonable and relatively low. Hon. Members opposite do not like what I am saying, but I am speaking from facts and figures to which hon. Members are perfectly able to refer themselves.
§ Mr. Hudson
I should like to refer finally to matters which have been touched upon by my hon. Friend the Member for Angus, North and Mearns (Mr. Thornton-Kemsley). There is no doubt whatever that the rise in the cost 89 of living in this country is the direct responsibility of hon. Members opposite. During their period of office of six and a half years they attempted to overcome world conditions by buying cheap and selling dear. We had a seller's market in all countries during those years. They attempted to buy food at much less than world costs of production and to sell our own goods as dear as possible.
§ Mr. Hudson
The result is that producers have learned to mistrust the intentions and integrity of bulk buyers and production has not expanded as it should have done, and as it would have done if proper prices had been paid.
§ Mr. Hudson
No, I will not give way. The right hon. Member for Easington said that between the wars the price of food, or the cost of living, was too high in relation to wages. I remind hon. Members opposite that by 1922 everything in this country was de-controlled. Prices rose sharply for a brief period but it was not many years before Danish bacon, for instance, was being sold in this country at 6d. a lb. So the right hon. Gentleman's statement was utterly wrong and absurd.
Prices which prevailed between the wars prove that once bulk buying is abandoned and there is the freedom to buy and to trade, upon which our policy is based, supply overtakes demand and the cost of living comes down. That is the fundamental principle upon which we base our case and until we get to that point the cost of living never will come down. When that principle is applied, it will come down and then hon. Members opposite will have to withdraw.
§ 6.27 p.m.
Mr. Percy Daises (East Ham, North)
The hon. Member for Hull, North (Mr. W. R. A. Hudson) has made an extremely useful speech, if not as a contribution to a serious discussion of the problem, certainly as a contribution to the propaganda of the Opposition. I do not want to be too unkind to him, but he certainly conveyed to me that he thought very strongly that the workers were far too well off and had been wet-nursed in the past.
§ Mr. W. R. A. Hudson
Rubbish. Will the hon. Member direct me to words which I used which would convey that meaning?
§ Mr. Daines
That was the general impression which the hon. Member made on my mind. If my mind is somewhat limited, be that as it may; I am not complaining. Hon. Members opposite called out "Rubbish." If they think they have a contribution to make to the debate, no doubt they will have the opportunity of demonstrating in their speeches how much they know about rubbish.
It is quite clear from the speeches which have already been made from the benches opposite what general line will be followed. I find it extremely interesting that we are not to have the privilege of a speech from the Parliamentary Secretary to the Ministry of Food. We are, indeed, having some extraordinary Ministerial shifting in this Chamber. We had flying visits from the Ministry of Civil Aviation on all difficult and highly technical points on the Finance Bill. Today, when we are dealing with food in a world setting, it is interesting to know that we shall not have the privilege of hearing from the Minister of State for Economic Affairs. I see one connection between him and food.
§ Squadron Leader A. E. Cooper (Ilford, South)
On a point of order. The hon. Member has just said that we are dealing only with food today. That is certainly not my impression. I understood that the debate would be very much wider.
§ Mr. Daines
I am very sorry that I am not making myself as clear as I usually do. I definitely said—and I think it was in the hearing of the Committee—that we are dealing with the question of food within the world economic setting. I was going on to say that it would be right and proper that we should have the advice of the Minister of State for Economic Affairs. I certainly feel that there is some connection between him and food, because I remember the way he used to scuttle in and out of the Chamber, like a frightened rabbit, while the Finance Bill was being debated.
91 If we had a speech from the Parliamentary Secretary, who is looking very carefully at the gallery opposite him—I hope he will turn his rather mournful countenance upon me—I am sure that he would come out with the alibi which we have heard so often, that the real question is the balance of payments—"If I had the dollars then we could get the food." I understand that Lord Woolton's alibi for the red meat situation is, "The red meat is in the United States all right, but we have not got the dollars to get it out."
I agree that the balance of payments is a crucial, vital and fundamental problem, but it is not some abstract matter between Government and Government. The balance of payments is a living reality to millions of working-class households every Thursday and Friday. The question is, "What have we got to do without in order that we can get enough money to pay the food bills"?
I can see quite clearly that one of the claims of the Government will be realised before we are much older. If they stay in office two or three years undoubtedly they will carry out one promise and abolish rationing. Already we are well on the way to the abolition of rationing by legalised controls and ration books and the substitution of rationing by price. One has only to do the weekly shopping, which is something that I have done for many years, to notice very clearly in any shop where working people go that the bacon ration is not being taken up and the best lots are going to the people with the higher salaries.
An hon. Member who addressed us earlier showed a very close understanding of the meat trade. I should like to quote from the President of the National Federation of Meat Traders, who was reported in the "Daily Telegraph" of 10th July as follows:The ration may be up to Is. 10d. in August. When this happens the ration will be as much as people can afford to buy.[HON. MEMBERS: "10th July?"] Yes. 10th July. [HON. MEMBERS: "Which year?"] This year, of course. [Laughter.] I am sorry, I should have said 10th June. I do not understand the cause of the hilarity. There is nothing very funny when, as one hon. Member said, the working people who cannot buy the best cuts always have to take the scrag 92 and the other bits. There is nothing funny in the fact that we are going to have meat rationing by price.
§ Mr. Osborne
The hilarity was caused not by what the hon. Member said but by his insistence that his quotation was dated 10th July, which has not yet arrived, and when he was told that 10th July had not arrived he still maintained that it was 10th July.
§ Mr. Daines
I am obliged. I confess that it is one of my idiosyncrasies that I refuse to wear my National Health spectacles to see my figures properly. I will try to avoid that error in the future. As we are repeatedly told, we see increasing prices spreading all around us. What is extremely significant is the fact that we are debating a food situation in the middle of what I think has so far been a particularly pleasant summer, so far as the weather is concerned.
The greengrocers' shops today are full up with a variety of fruit, or as full as I can recollect for the last six or seven years. The price of tomatoes is down. There is such a large influx of soft fruit into the shops that many other products are rapidly coming down in price, but it is going to be a very different situation when the grim days of November come. It is clear from the policy that is being pursued and the way that prices are rising that we are in for a grim period as the months advance.
The Financial Secretary, in answer to my hon. Friend the Member for Coat-bridge and Airdrie (Mrs. Mann), called attention to one significant fact that is occurring in the price changes, namely, that 75 per cent. of the increase in the index figure is accounted for by the rise in prices of food. It is all very well to suggest, as one hon. Member opposite did, that we should take a full view of the question of price increases. The general implication in speeches by hon. Members opposite is that it is true that we have had some increase in the price of food, but that this has been compensated by a drop in the price of textiles and clothes. That is only partly true. The comparison with textile and clothing prices is always made against the peak following the Korean war. By comparison with 1947 prices, there is still a substantial increase in the price of textiles.
93 Today we are having a battle of statistics. I do not know how far I dare venture on this matter, but I think that perhaps my statistics are as good as those of the Government or, indeed, of most hon. Members. What I think is perfectly clear to any objective-minded observer is that, taking the last six months of the Labour Government against the first six months of the Tory Government, there has been a marked decline in the standard of living of the mass of the people. This is perfectly clear, and I will try to show it by figures which I have verified.
Taking the period May to November, 1951—that is during the period of the Labour Government—wages for all workers rose from 118 to 126, that is, by 8 points. The price of food rose by 8.1 points, but the cost of living of all items rose by 5 points. That means in actual terms of the standard of life, taking the whole picture, that the position of the wage-earning classes improved, if not substantially, certainly slightly. Under the Tories we find that food prices in the first six months rose by 12.2 points, while wages rose only by 2 points. This is not the whole story.
I have a considerable sympathy with one hon. Member who interjected this afternoon and said that we cannot feed people on indexes. But indexes in the shape of all these statistics are only a mirror reflecting the position, and reflecting it rather feebly. We have today nearly half a million unemployed. I am not going to put all the blame upon the present Government for that. We have gross under-employment right through many industries.
What is extremely significant is that we have a substantial, marked decrease in the small savings of the people in this country. I find that during the five months starting at the beginning of the year, the net decrease in share capital of the Co-operative movement is £5¼ million. It is exactly the same with National Savings, and with the building society movement. We are seeing the barometer of the standard of life, as reflected from the standpoint of savings, showing perfectly plainly and clearly that, because the ordinary people have to pay more for food, they cannot save and they cannot afford to buy many of the so-called luxuries of the past.
94 Earlier the Minister of Food made great play about the amount of money that the workers spend on beer and tobacco, and let us remember that. By any definition, the workers represent nine out of any 10 of the population. Certainly the impression which he made on my mind was that they had no right to have beer or tobacco.
§ Mr. Osborne
The hon. Member said that the Co-operative share capital had dropped by £5¼ million. I should like to know the amount which has been reduced by £5¼ million.
§ Mr. Daines
I am sorry, but I have not got that figure. I will give it to the hon. Member later. I cannot give it proportionately to the total share capital. I did not arm myself with that figure. But I can say that it is a complete reversal of the position that we had about 18 months ago. It is true that there has been a decline, but the rate of decline is very marked and substantial during the six months since the Government came into power.
§ Mr. Godfrey Nicholson (Farnham)
I should like to ask the hon. Member a question about the figures he gave in relation to the rise in food prices during the last six months of the Labour Government and the first six months of this Government. Will he tell us from where he got those figures? They do not square with the Monthly Digest of Statistics.
§ Mr. Daines
I will give the hon. Gentleman that information in due course. If I have quoted my figures wrongly, I shall certainly correct them.
We come to the simple fact that the alibi which the Government are trying to adduce today, in connection with the lack of dollars, is no real alibi at all. I cannot remember any kindness from Members of the present Government when they were in opposition and when we were faced with exactly the same position. How tawdry do Tory election promises look today. As I listen to hon. Members opposite this afternoon, I can picture the days when we had literally thousands of posters all over the country which read: "The Tories will fight the rising cost of living." Any proper examination of what has happened shows quite clearly that the present Government 95 have consciously and deliberately willed the present increase in the cost of living.
We have had the rise in the Bank rate, with all its consequences. We have had an increase in the interest charges in connection with house purchase, and the difficulty, which I have already mentioned and which is so patent, as far as unemployment is concerned. I have noticed that during the last two or three weeks the Chancellor of the Exchequer—who, let me say, is one of the most able members of the present Administration; I am speaking only for myself—has found it necessary to meet the T.U.C. twice. I can well imagine that, despite all the work which the right hon. Gentleman has done in the social services, he does find it rather strange to meet the T.U.C.
But the trade union movement of today is very different from what it was in pre-war days, when we had the old set-up of continual Tory Governments. The trade union movement today is conscious of its power and it knows how to use and deploy that power. It is deeply conscious of the duty it owes to the State. To slash the food subsidies by £160 million does seem to me to be an extremely strange way of getting to grips with the problem that the trade union movement has to face. We have only to have two substantial wage increases—that of the miners and of the railwaymen—for the whole of the saving on the food subsidies to be swept completely out of the window.
I believe in food subsidies. I should like to make that perfectly plain and affirmative. I cannot see anything wrong, in principle, with food subsidies. We employ the method of subsidy in the case of the Health Service. We employ it in the case of housing and education. After all, what is it? It is also represented by family allowances and the social insurance system. It is merely an economic device for spreading out the product of the country, and if it is logical and socially desirable that we should spend many millions of pounds—I think it runs into hundreds of millions—in curing disease, it seems to me to be perfectly logical and only common sense that we should use the device of food subsidies to maintain minimum standards of nutrition in order to keep the people healthy.
§ Brigadier O. L. Prior-Palmer (Worthing)
The hon. Gentleman asked what we found wrong with food subsidies. I am not trying to make a party point, but I should like to ask the hon. Member whether, as a good Socialist, he would not agree that it is utterly wrong to subsidise a man with £2,000 a year to exactly the same extent as a man earning £4 10s. a week. That is what I consider to be wrong with food subsidies.
§ Mr. Daines
The hon. and gallant Member is referring to a rather wider picture. This year the Chancellor of the Exchequer gave food subsidies a heavy slash; but it is also true that the millionaire has had a very substantial change in his Income Tax position which more than compensates for it, and I am entitled to draw the conclusion that the two things are connected.
There is really no difference in principle between food subsidies and the Health Service. It is exactly the same with education and with social insurance. The poor millionaire, who seems to worry the hon. and gallant Member such a lot, has to pay in any case for his old-age pension or unemployment insurance if he is in the employed category. We have gone too far along the road of that principle to get unduly worried about it.
I claim that when we examine in detail, point by point, the various economic enactments of the present Government, time after time they have had a direct effect in increasing the cost of living. We have had increases under the Health Scheme, as referred to by the hon. Member for Houghton-le-Spring (Mr. Blyton). We have had the increase in the petrol tax. In the Co-operative movement an assessment has been made of the cost of that increase and it is estimated that it adds at least half a million pounds to the total transport cost of the Co-operative movement in one year.
I do not want to be unfair. On the different occasions when I have spoken and thought about this subject, I have tried to analyse what is really the objective behind the policy which the Government have pursued. Surely the Chancellor of the Exchequer must have seen that the trade union movement was bound to react with a wholesale demand for wage increases? We all know that if 97 substantial wage increases are given they are going to be reflected in the prices of commodities and particularly of exports. Why did the Chancellor do it? What is the conclusion which one must draw from the food policy that has been pursued? I am driven to the conclusion that the policy of increasing the price of food is a deliberate one and has been used as part of the scheme for limiting imports of food.
I have always affirmed that when we had a Tory Government they would be compelled by the force of circumstances, and in order to try to save what they could of the system in which they believe—and which is passing—and the power, which they are losing, to try to get back to something like the policy they tried to follow before the war. I think they are following this policy of depressing the standards of life, not out of cussedness but because they know that if their class is to get back to the position where power is based upon economic wealth they have to take a much larger slice of the cake than they had under Labour Governments.
§ Mr. Daines
Hon. Members must restrain their impatience because I have another two sentences to utter. I also believe that the Government see clearly that the only way they can hold in check the economic power of the worker is by the continuance in this country of a policy which will land us into a substantial margin of unemployment. I say to the work-people of this country, from this Committee: You can be very brave when there are more jobs than there are men, but when the position is reversed, then the worker has not the economic power which is necessary to maintain his position.
I do not believe the food policy of the Government is merely muddle. I do not believe it is purely dither. I believe this is part of the last attempt by the capitalist classes of this country, who see power passing from them, to follow a policy which can maintain the remnant of their power as long as possible.
§ 6.51 p.m.
§ Mr. Baker White (Canterbury)
I do not propose to follow the hon. Member for East Ham, North (Mr. Daines) very far in his argument, and certainly not to 98 deal with the last part of it, but I congratulate him on one thing: he is the first speaker on that side of the Committee to mention the cost of living in any detail. The other hon. and right hon. Gentlemen have avoided it altogether.
I want to deal with the question of people not taking up their meat ration. Like some right hon. and hon. Gentlemen opposite, I live on the edge of a mixed mining and agricultural village. I have constant opportunities to talk to the miners, as constituents of mine, and although we are diametrically opposed in our political views, we are very good friends on other subjects. I have made it my business to ask the butchers and grocers of my village whether people are taking up their meat ration or not, and I am told that practically all the people are still taking up their ration.
In any case, the point made on this subject by hon. Members opposite is not valid, because if they go back to the records of November, 1940, they will find that three people out of 10 did not take up their meat ration and four out of 10 did not take up their bacon ration. The hon. Member for East Ham, North also made a point about the Petrol Duty, but I think he forgets the purpose of that increase. It was to reduce the consumption of petrol as an alternative to the objectionable system of rationing.
From the point of view of the Opposition, obviously it is a pity that the latest retail price index shows no rise on the previous month. If they have lost a transitory party political point, I am sure the consuming public as a whole are thankful. The Opposition are trying to base this debate on two false premises. The first is that the rise in the cost of living has taken place mainly since the Conservative Government came into power. The second is that a disparity between the wages index and the cost-of-living index is the result of Tory rule.
It is important, I think, to look at the elements which go into the cost-of-living index. They are food, rent and rates, clothing, fuel and light, household durable goods—that is, furniture, floor coverings, and domestic appliances—miscellaneous goods—that is, soap, soap-less detergents, polishes and cleaning powders, services, fares, and drink and tobacco. The hon. Member for 99 Houghton-le-Spring (Mr. Blyton) accused the Government of putting up the fares since they came into power, but the fares were increased by a nationalised transport commission.
§ Mr. Baker White
I believe this is the first time that the two graphs of the cost-of-living index and the wages index are beginning to get a chance of smoothing out into one, and I remind hon. Members opposite that ever since 1947, when their Government introduced the new index, the index of wages has been slightly behind the cost-of-living index instead of being in front.
Hon. Members may ask what are the indications that the cost-of-living index is beginning to smooth out—and it is beginning to smooth out before we can see the effect upon it of the increased social benefits and the full effect of the reduction in direct taxation. The things which are showing sharp falls in price are household linens, men's and women's clothing, floor coverings, pottery and glass, household cleaning materials, furnishing fabrics, and, to a limited degree, furniture—particularly second-hand furniture—beds and bedding.
I should like to give one or two examples. I make no apology for giving these figures because it is much better that I should give them instead of embarking upon an involved argument which would take much longer. Let us take, first, household linen. A bath towel which cost 19s. 3d. six months ago now costs 14s. 11d. Pillow cases are 2s. cheaper than they were, double cotton sheets which cost £3 5s. 10d. now cost £2 15s. 8d., woollen blankets which cost £5 8s. 9d. now cost £3 19s.
Let us turn to carpets and furnishings. Wilton carpeting, 27 inches wide, which cost £2 5s. a yard now costs £1 9s. 9d. a yard. For curtains, glazed chintz, which was 10s. 6d. a yard four months ago, is now 4s. 11d. I want to emphasise that the prices which I am giving are those prevailing a month ago and they do not take into consideration the further decreases which have been made in the sales this week.
§ Mr. Mellish
The hon. Gentleman is going down the list of price decreases, 100 but he knows quite well that people are not buying, and the answer must therefore be that the cost-of-living problem is more acute today than it has ever been.
§ Mr. Baker White
If the hon. Member will be patient a little longer, I will explain why I believe prices are coming down. Utility tea sets, which were 25s. 9d., are now 18s. 6d. The young couple who are prepared to invest a little money in their home by buying a decent carpet for the front room can now get one for £20, whereas four months ago they would have had to pay £30.
Let us turn to clothing. A man's made-to-measure suit, which four months ago cost £18 15s., now costs £13 15s. I know, because I have just got one. Reductions in clothes off-the-peg amount to sums varying between £5 and 15s. A wool gaberdine raincoat which cost eight guineas before now costs £4 19s. 6d. There are comparable reductions in women's clothing.
Some soaps and cleaning materials are down in price, and we are told that wireless sets of the table variety are to be reduced by one big maker by from four guineas to six guineas a set. Hon. Members may ask what that has to do with the cost-of-living index. Wireless sets happen to be in it. If hon. Members will look at the compilation of the index, they will see, under the heading of appliances, that radio sets come at the top. There are 12,690,000 homes in this country with a wireless set in them—or, rather, there are that many licensed sets, and there may be some others as well.
Why are these reductions taking place? The sharp reduction in the prices of fabrics are due in part to the fact that manufacturers, wholesalers and retailers are all cutting the prices of the lower-priced materials to bring them within the new tax-free D scheme limits. This seems to discount the fear which was expressed by hon. Members opposite, when discussing the D scheme, that its effect would be to force up prices for the lower income groups in the community.
Most of these price reductions I have mentioned arise undoubtedly from the operation of the law of supply and demand in a period of sales resistance, because many people over-bought last year when they thought prices were going even higher; and it arises from the desire 101 of the retailers to clear their stocks of goods before the new fashions come in. To that extent, I agree, they are fortuitous and their effect on the cost of living is fortuitous, but that does not make them any less of a reality—and a welcome reality—to the buying public. I believe that at the present rate of consumption buyers should benefit from these prices for another three or four months.
What will happen then? I think the whole thing will depend on the trend of world commodity prices. I could argue, as an economist, that people should take a close interest in world commodity price trends, but I know perfectly well they do not until translated into terms of retail prices. I believe that world commodity prices are going to come down and that, although some of the prices in this range I have mentioned may rise slightly, the long-term effect on world commodity prices will be such that the fall in the prices of these goods will be permanent, that they will not go up again.
I turn to the question of rents and rates. I am not going to pretend that that item in the cost-of-living index is likely to show any material change, but I do say that the Government are trying to do something which the previous Government never did—get down the cost of building houses. By building the "People's" house it is possible to get 11 houses out of materials uesd for 10 before, and reduce labour costs. The Government have reduced the cost of Government-held timber to builders, and have brought down the price of lead. The free enterprise cement industry has brought down the price of cement by 3s. per ton. I often wonder, if the party opposite had had their way and nationalised the cement industry, what the cost would have been.
§ Mr. Baker White
I hope and believe that in the near future there may be a reduction in the price of paint, which is an important item in house building, but I do say that this Government have done more in six months to get down building costs than the other Government did in six years.
There has been some controversy over this question of drink and tobacco and the index. I am not against people smoking or drinking—I do so myself—but I think that as the items of drink and 102 tobacco come into the cost-of-living index we must have a sense of realism about them, particularly when we remember that those are the only items on the index we ourselves completely control, for we can cut down our smoking or our drinking if we want to.
In the last financial year the nation spent £1,589 million on alcoholic drink and tobacco, which is a sum of £44 per head per year of the adult population, and if we include the turnover on gambling and the money spent on amusements, that figure becomes £50 per head of the adult population. I make that point only because, as I say, it is the one item in the index over which we have complete control.
So far as fuel and light are concerned, they lie in the hands of State boards, and so does transport, but I hope and believe that it may be possible in the comparatively near future to get down the price of petrol, as I understand that tanker freights are coming down from 185s. to 100s. a ton, which is a reduction of 4½d. a gallon. I hope and believe that the petrol companies, with the great profits they make with their world-wide trade, when this reduction comes about will pass some of it on to the consumer. Motor car tyres, bicycle tyres, motorcycle tyres have come down 7½ per cent. The limited number of people who depend on motor cars for business find that second-hand cars are becoming cheaper.
The whole question is what we are doing about home food production. I was rather surprised that the right hon. Gentleman the Member for Easington (Mr. Shinwell) said that we must get producer groups, and that sort of thing, going. I wonder whether he has ever heard of the pig clubs which have been going since 1939. I wonder whether he has ever heard of the magnificent work done by Women's Institutes and the W.V.S. in the villages to produce more food.
But what have the Government done? One thing this Government have done is to get 500,000 more acres under tillage cultivation as a result of their first moves with the ploughing-up grants. So far as food production is concerned, I see some hope in imported feedingstuffs. Imported barley which cost the Government £40 a ton last January is £8 a ton below that figure for autumn delivery. If we can 103 get more home production and more feedingstuffs at less cost, we shall get down production costs. But world food is not cheap. It is not going to be cheap, and it is misleading the nation to pretend it is.
It is useful, but not necessarily conclusive, to compare our food prices with those in other countries—with those of Soviet Russia, for instance, that workers' paradise—
§ Mr. Baker White
A small minority of hon. Members opposite who have a deep admiration and affection for that country's methods. I have got the prices from an official list in Pravda, translated into British Weights and currency at the official exchange rate of 11.14 roubles to the £, and here they are. Black bread is 1s. 3d. a lb.; white bread, 2s. 5d. a lb.; butter, 24s. 5d. a lb.; meat, 12s. 2d. a lb.; sugar, 8s. 11d. a lb.; coffee, 40s. 8d. a lb.; milk 2s. 0½d. a pint. These are prices in a complete Socialist State to which the right hon. Gentleman the Member for Ebbw Vale (Mr. Bevan) and his followers wish to move towards, even if by a different road from that taken by the Kremlin.
§ Mr. Baker White
One would have expected that a debate on the cost of living would have been opened for the Opposition by the former Chancellor of the Exchequer, the right hon. Gentleman the Member for Leeds, South (Mr. Gaitskell), and one might have expected that it would have been wound up for the Opposition by the former Minister of Food, the right hon. Gentleman the Member for Bradford, Central (Mr. Webb). But it is not so. Perhaps it is not so surprising, after all, because the former Chancellor of the Exchequer knows perfectly well why the cost of living has gone up in recent months, and he knows that he would not have stopped it himself. The former Minister of Food has made it perfectly clear that in present world conditions cheap food is an impossibility.
I say only one other thing. I spent this last week-end at Brighton, that lung of London where the industrial 104 workers and the commercial workers of London go to enjoy themselves. I sat on the two piers, watching those Londoners, and talking to them, and I even visited a house of refreshment with some of them, and I discussed with them this question of the cost of living. Many of them were anxious about it, but I say that the anxiety in their minds can be removed by argument. Many of them did not know of the social benefits coming into play—they had no idea—and I found one person after another repeating the propaganda nonsense put out by the party opposite.
§ 7.9 p.m.
§ Mr. Frank Tomney (Hammersmith, North)
We have discussed the cost of living mostly in relation to food prices, but the cost of living covers a much wider field and embraces import costs, export costs, the balance of payments, production, wages and prices. Some people determine their cost of living by means of standards they enjoy; other people by necessities we must have; some people determine it by the ordinary position they have to maintain, and other people determine it by the luxury position they have to maintain. Even taking into account all these factors, we nevertheless come back to what is the least common denominator in all this argument, and that is the lower paid worker. It is the standard attained and desired by the lowest paid worker which, in the long run, determines this whole question.
Despite some of the arguments of hon. Members opposite, some of them have agreed, belatedly, although generously, that in view of world prices the cost of living cannot be controlled by any Government, and that some of the difficulties of the Labour Government are still being experienced by the present Government. In view of those factors, we must consider what advances the lower paid worker has made in the last six years; what was his changing social and cultural pattern and his natural aspirations and ambitions.
The complete picture is one of a new social structure throughout the whole life of the country, taking into consideration all aspects of the cost of living. We have to consider education and educational advance, the increased necessities nowadays due to high scholarship grants and fathers having to provide for their 105 children a more expensive scale of education, sometimes school uniform, and even special tuition—things they never had years ago. Those are all part of the changing social pattern.
The greatest change, though, is reflected in the attitude, development and standard of the female population in the last 20 or 30 years. The greatest single factor of which we have become aware is the great change in the outlook of the ordinary woman towards her standards, her dress, her beauty aids and all the things which go to make up a distinct personality. None of these things were thought of years ago, but today they are accepted facts.
Women in general not only enjoy all these things but, what is more, demand them. That is more so in the United States than anywhere else in the world. All that is part of the changing social pattern, but none of those things is included in the cost-of-living index, which workers generally, and trade unions on their behalf, have always felt should be included. These things cannot be denied. Women have their place in the world and in our community. They have advanced, and intend to advance further.
In the last analysis we are entirely dependent on production, on the primary producer, whether in the field, factory or workshop. In the long-run it is on those workers upon whom the general standards which everybody will enjoy depends. The hon. Member for Canterbury (Mr. Baker White) referred in some detail to factors which he thought affected the cost of living. They do, but not to the extent that he thinks.
Linen, carpets and tea sets, to which he referred, are all contained in the cost-of-living index and have a general effect on the cost of living, but only on a diminishing basis, because the ordinary workman cannot continue purchasing linen, carpets and tea sets. The ordinary workman may purchase a carpet once every 10 or 11 years; in a working-class house a tea set will last a lifetime; and the average housewife will, on her marriage, stock up with linen which will last six or eight years. The reduction in prices of those items is due in part to the diminishing demand caused by unemployment.
§ Mr. Nabarro
I can claim to speak for the carpet industry, which is centred almost entirely in Kidderminster. The three reductions in prices in the last 18 months have been due to the fall in the prices of essential ingredient materials, and have been nothing at all to do with diminishing demands.
§ Mr. Tomney
The price of wool has dropped 1s. 6d. a lb. in the last nine months, but the general demand has been reduced because of lack of purchasing power, higher prices and greater unemployment.
§ Mr. Tomney
I must now return to the subject of food, which is the most important feature of this debate. It is on this question that the housewife determines with what frequency and for how much she asks her husband for an increase in the weekly Friday outgoings. The housewife is finding it increasingly difficult, due to rising prices, to buy a variety of food to supply that varied diet which makes for an adequate and nutritious standard of living. For example, today many women cannot afford to buy fruit from the local greengrocer. Other items as well have risen in price.
In addition, hon. Members opposite have admitted that for many years to come it will be difficult to supply the food needed, because there is a diminishing agriculture force in every country in the world. In those circumstances it is no longer ethical or just to expect to have cheap food at the prices for which we got it in the 1920s. It would be wrong of us to expect it.
In view of all those factors it is essential, no matter what party is in power, for the Government to adopt a policy of bulk purchase, or State purchase, or international contracts to ensure that our people, who can never feed themselves, are adequately fed. There is no other way of doing it. Any other method will send up the prices of food. That has been proved time and time again. The contracts now in operation are more beneficial to this country than the contracts negotiated by private buyers. The higher food prices in other countries are a justification of the policy we have been outlining and have put into operation. We negotiated on a world basis, and I warn the Government that any interference 107 with that policy will lead to a shortage of food in this country, and to higher prices which will send the food supplies under the counter so that only those with the largest purses will be the buyers.
The trade union difficulties have been outlined by my hon. Friend the Member for Houghton-le-Spring (Mr. Blyton), and I shall not pursue them. While the demands of railwaymen, miners, and others provide a general basis for examining this problem, it is best to look at the position as it affects men generally in trades. We find on examination of trades on an individual basis that the wage increases asked for are perfectly justified.
I referred, in my opening remarks, to the effect of the cost-of-living index on the public. Modifications have taken place, but I am still of the opinion that further modifications are overdue. The original index figure for food was 348, now modified to 399; rent and rates, 88, now modified to 72. That is completely wrong, it is essential to take into account that estates are being built, in almost every case, outside the existing towns, and the increase in the cost of travel in getting to and from work automatically means an increase in the cost of living of the worker. People have no control over these factors. They have to go where the houses are being built.
For clothing, the original index figure was 97, modified to 98; fuel and light 65, modified to 66. I think that is also wrong. I could go through a whole list of prices, and I think that, by and large, the values in the modified new form do not cater for the increases which are taking place in the cost of living from day to day, in such things as canned ham, coffee essence, sardines, ice cream, canned fruit and vegetables.
It has been said by an hon. Member opposite that prices were too low and wages were too high. The gap has been narrowed between prices and wages, but wages are still lagging behind to the extent of about five points. It has not been possible to determine accurately what effects further price increases will have. In regard to the decision on wage negotiations, one thing we can say is that the T.U.C. will, in view of all its responsibilities, have the greatest difficulty in maintaining and restraining legitimate 108 wage increases throughout the whole field of industry in order to recoup the cost-of-living index in favour of the worker. It is not only in food that he feels the draught. If we take the whole range of prices which have risen lately we can include electricity, gas, letter postage and tyres, and further increases in prices are yet to come. There is every indication that the 1953 harvest will mean increases in the price of wheat by 1s. 3d. a cwt., barley 1 s. 6d. a cwt., oats 1s. a cwt., rye 3s. a cwt., sugar beet 4s. 6d. a ton, potatoes 5s. a ton and milk 1.45d. a gallon.
It is suggested in some quarters that it will be possible to recoup these prices over a long period by the fall in prices of raw materials. There is certainly a fall in the prices of raw materials throughout the world in certain commodities, but I think it will be many years before we can hope that the fall in prices of raw materials will have any beneficial effect upon the cost of living.
There has been a fall in price in certain categories of copper, fertilisers have been reduced by 15s. a ton, jute by about £50 a ton, sulphur by about 7 per cent., sulphuric acid by about 7 per cent. and tungsten by 35s. a long ton unit. All these reductions are effective from 1st April, but all of them, and many more, if there is a fall in world raw materials prices, will not be reflected in the ordinary standard of living of the people of this country for many years, if we take into account the ordinary outgoings of the average householder not only in matters of rent, rates, cigarettes and tobacco, but also such items as bicycle tyres, timber, and gardening tools, which have all become necessary to a higher standard of living.
It is not the intention of the workers of this country to go back to the days which they formerly knew and to accept a reduced standard of living once more. The purpose of life is to increase one's standards and to try to do the best for oneself and one's family. There is a growing realisation of that throughout the world. There is an awakening conscience throughout the whole of the working class that they are entitled to enjoy the benefits of a higher standard and a happier life. They are prepared to work for that standard given the right leadership and guidance. It will not be done by indiscriminately raising or lowering 109 prices which are going to affect drastically their weekly wage packets.
The Government have produced no formula for stabilising and retarding the cost of living. Long-term promises may or may not materialise. I ask them to consider, before the cost-of-living index rises much further, whether it would not be better to revert even more stringently to the policies we carried through and outlined from 1945 onwards.
Once we arrive at the position where rationing is no longer controlled by the ration book and we are rationed in effect by prices, we have arrived at a position in which the poorest paid wage earner and his wife and family are going to suffer most. That is what is happening today. It may not be happening in Canterbury, where there is a rich population, but it is certainly happening in parts of Lancashire and London. Once that becomes the accepted standard, and there is a rise in unemployment to go with it, it means that the Government will be faced with very considerable industrial disturbances.
I beg of them to watch the position very carefully, to take stock of just where prices are going, and to remember that the average wage does not cater for rising prices. People in that range have received no benefits from reduced taxation because they did not pay Income Tax in the first place, and so they have received no benefit whatever. If the Government make a serious attempt to understand the position, like some hon. Members have done today, to realising that world prices are not controlled by what we do here, and make an attempt to create lower prices, they will have the goodwill and backing, generally speaking, of the trade unions of this country.
§ 7.30 p.m.
§ Mr. Cyril Osborne (Louth)
I hope the hon. Member for Hammersmith, North (Mr. Tomney) will forgive me if I do not follow him closely in his reasoning. I agreed with a good deal of what he said at the end of his speech.
The most important question which has been asked in the debate was that by the hon. Member for Houghton-le-Spring (Mr. Blyton). He asked what is to happen now that the trade unions are demanding £300 million extra in wages. That is the most important economic question facing the country. The answer 110 is that if those wages are paid for the same amount of work and the same amount of production our costs must go up proportionately, it will be more difficult for us to sell our goods abroad, and in turn our food prices will rise and we shall have mass unemployment.
I want to give hon. Members opposite the answer in the words of someone else. The question was answered in anticipation by the late Sir Stafford Cripps at the Edinburgh Labour Party rally on 7th February, 1948. He said:… the one certain way to destroy full employment"—I would point out, in passing, to hon. Members opposite that they are totally mistaken if they think that hon. Members on this side want to create unemployment. That is the last thing we want to do. [Laughter.] I am surprised to see the right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths) laughing at that.
§ Mr. James Griffiths (Llanelly)
The hon. Member need not be at all surprised. I lived for 20 years in South Wales under a Tory Government.
§ Mr. Osborne
The right hon. Gentleman need not think that no one else is interested in employment for the workers. Sir Stafford Cripps said:… the one certain way to destroy full employment and to bring back insecurity of unemployment is to embark now upon an inflationary spiral which will make it impossible for us to get the raw materials we need for our industries. We shall be faced with the terrible alternative of less food or less raw materials, because we cannot export enough to pay for both.If hon. Members will not believe the sincerity of those of us who sit on this side, I am sure that they will at least accept that from the late Sir Stafford Cripps.
The greatest disservice which hon. Members opposite have done, perhaps unwittingly, to their own followers and the nation as a whole is to give the impression that somehow the nation can have its food at less than it costs to produce it. The hon. Lady the Member for Cannock (Miss Lee) was against that general impression, for she, as a miner's daughter and as one who represents a mining constituency and understands the position, said that in the olden days coal was sold too cheaply and we could not afford to pay the miner a decent wage.
111 We all know that is true, but the same truth applies to the production of food. If it is unfair and socially wrong to expect cheap coal at the expense of the miners' wages, it is equally wrong and socially unjust to the farm worker to demand that we have our food at the expense of his labour. We must face up to it that both at home and abroad the nation must ultimately pay for its food the real cost of producing the food.
§ Mr. Mellish
Why did not the hon. Gentleman put those arguments forward when his party were in Opposition?
§ Mr. Osborne
If I had an opportunity to produce my Press cuttings and my HANSARD cuttings, the hon. Gentleman would see that I put forward those arguments many times during the 1945–50 Parliament.
We are faced with the grave problem that over a period of many years the nation has come to expect cheap food as a right. The day of cheap food has gone, no matter what party is in power, and it has gone for ever. The economic position of the country is so grave—it will affect all our pockets and all our stomachs—that the people outside are rather tired and a little nauseated at our sitting up all night bickering about matters that really do not count when we ought to be giving our attention to solving the grave economic problem which faces us.
I want to make four points about the food position. I am sure that I shall carry with me the hon. Member for Sunderland, North (Mr. F. Willey) because he was formerly Parliamentary Secretary to the Ministry of Food and at least knows something about it. First, of all the food we consume 55 per cent. is produced at home. The National Union of Agricultural Workers is asking for an increase in the basic wage from £5 10s. to £7. If that increase is granted, the food the agricultural workers produce will cost us more. Hon. Members may say that some of the increase can come from the profits of the bigger farmers. Perhaps some can—I am not going to argue that—but, if it does, the profits made by the bigger and wealthier farmers will be reduced and the Treasury will receive less from them in taxation.
What would be the position if we could increase our home production of food to 112 65 per cent. of the total consumed? I believe it could be done, and in that direction lies our greatest hope of salvation. I do not believe that we shall ever be able to buy abroad all the food we used to buy in the past and we must recognise that the amount produced at home will cost us more if the agricultural worker is to have the wage for which he is asking. Ought not the agricultural worker to have an increase when his basic wage is £5 10s. compared with the average wage of the miner of £11 10s.? If the agricultural worker has an increase, then we must pay more for our food.
The second point is that there are smaller food surpluses in the world. The basic reason is that countries all over the world are turning from agriculture to industry. Not only are they producing less food in consequence, but they have also a great deal less food to sell because they are keeping more food for their own industrial workers. The Argentine has probably been industrialising itself more rapidly than any other nation since the end of the war. What are the consequences? Last year we obtained from her less than one-fifth of the beef we had from her before the war. We shall never again get from the Argentine meat in the quantities that we need.
The position in Australia is very much the same. It is no good hon. Members opposite thinking that their party politics will alter the international situation. Australia is likely to become a net importer of food. She is going into the New Zealand market to buy those very surpluses which ought to come here. It is no good hon. Members opposite showing surprise. In Australia the drought has lasted for 18 months and three parts of the country's cattle are in danger. It is obvious that we shall not get the meat from that Dominion that once we did. Furthermore, it is important that the Committee and the nation should realise the stark realities of the situation. While hon. Members opposite say that some of my hon. Friends got votes under false pretences, it is twice as dishonourable for them to go and do it again, which they want to do now.
My third example concerns rice. The great rice bowl of Indo-China and Burma before the war produced 5¾ million tons for export, but last year the production was down to one million tons. The population there is growing rapidly, and we 113 must realise that the food is not available. Whether we like it or not, there are more people wanting to buy the diminishing surpluses that are available.
Not only has the world population increased by 25 million a year, but since 1938 our own population has increased by about three million. Of those, one million are children; and two million are pensioners. Neither group is in a position to fend for themselves. Therefore, if we are going to help those people, the stronger groups in between will have to do something extra to maintain themselves and these other people. I commend this fact to hon. Members the next time they go on to the platform to do electioneering.
§ The Temporary Chairman (Mr. Arthur Colegate)
If the hon. Member who is speaking does not give way, the hon. Member for Leicester, North-West (Mr. Janner) must resume his seat.
§ Mr. Osborne
On that point, I do not think the hon. Member has been in the Committee for more than a few minutes, while some of us have been here the whole of the time.
I come to what is probably the kernel of my third point—that it is not realised in this country that we, as compared with the bulk of mankind, are seven or eight times better off. According to the United Nations statistics, 64 per cent. of the world's population are living at one-eighth of our standard. Our income per capita for 1949 was 774 dollars, whereas for the 64 per cent. it was less than 100 dollars a year.
A group of hon. Members opposite have just published a pamphlet stating that this country should put its resources into a pool to raise the standard of life of the coloured people. That is a fine, magnificent ideal, but it is going to cost us £400 million a year to do it. I challenge the right hon. Gentleman the Member for Llanelly to go down to South Wales and say to the miners there, "That £400 million represents about 33⅓ per cent. of your rations. Are you prepared to give them up in the interest of the under-developed portions of the world?"
§ Mr. J. Griffiths
I am prepared to go to my people in South Wales and tell them that unless the great Western nations of the world pool their resources in an effort to raise the standard of living in Asia, Africa and other backward countries, there is no hope for a decent world.
§ Mr. Osborne
That is a wriggle am not prepared to accept. I ask the right hon. Gentleman whether he is prepared to go to his people and say to them that they must accept a reduction of one-third of their rations now. Of course, he is not.
§ Mr. Griffiths
I do not know about this one-third or this £400 million. I have read it in a pamphlet which I commend hon. Members opposite to read, but to which I am not committed in detail. What I have said, quite clearly, is that the people of this country have too long lived on cheap food at the expense of cheap peasants, and they want a higher standard of life. To help them we may have to make sacrifices.
§ Mr. Osborne
I am obliged to the right hon. Gentleman. The last thing I want to do is to misrepresent him, but we must realise that hon. Gentlemen opposite are complaining about our rations being cut and costs going up, and yet, on the other hand, the right hon. Gentleman wants to support a scheme for decreasing our rations further. [HON. MEMBERS: "No."] I am addressing the right hon. Gentleman. What he is suggesting would immensely decrease our rations and put up prices. While things are said about my hon. Friends on this side of the Committee, there is not the courage among hon. Members opposite to put those facts in front of their people.
§ Mr. G. Jeger
I am sure the hon. Member does not want to misrepresent the case in the pamphlet or the general philosophy which we on this side of the Committee hold. Can he say whether he agrees that the contribution that would be most valuable to these under-developed backward nations would not be to send them our rations in food, but to send them tractors, agricultural implements, fertilisers and those mechanised resources which would enable them to grow their own rations and eventually to contribute to ours from their surpluses?
§ Mr. Osborne
The hon. Member is taking me from my point, but I will seek to answer him. At the present time the first lot of crawler tractors, which are wanted all over the world, are about to be shipped to Australia. If we sent those first lot of crawler tractors to the underdeveloped parts of the world, we should get no return for them. We are going to get a return from Australia and New Zealand in terms of food, which otherwise we would have to do without. Therefore, if we followed the hon. Gentleman's suggestion it would represent an immediate cut in our rations. I am glad to see the hon. Lady the Member for Cannock back in her place, because she has the courage to face unpleasant realities, which her colleagues have not. She will agree that if we are going to help the people in the under-developed countries it will cost us something, and we should have the political courage to tell our people so.
My last point—and I am sorry that I have been so long—is that we should make clear to our people that, despite these other factors, the United Kingdom today is not in a position to buy the surpluses that are offered. Therefore, unless we can purchase those surpluses that are offered, no matter what Government are in power, our standard of life will go down. What I think we ought to do is to go to the country—[HON. MEMBERS: "Hear, hear."] There is one here who is not afraid to go to the country. I am not afraid. Hon. Members opposite may get a greater shock than they expect. [HON. MEMBERS: "Try it."] Hon. Members opposite are so queer, and they have such short memories. We were saying exactly this to them a year ago, and their answers were just as stupid as they are today.
My last point is the most serious of all. We are not in a position to buy the 45 per cent. of our food which we ought to buy abroad, and we are never likely to be able to do it unless there is a new attitude in this country towards work.
§ Mrs. Braddock
By whom? It is always the workers the hon. Member is having a go at, and never those at the top.
§ Mr. Osborne
A previous Financial Secretary to the Treasury, the right hon. Member for Battersea, North (Mr. Jay), 116 said in an earlier speech, when he was giving us an important set of factors—and I beg hon. Members to bear his figures in mind—that before 1914 the essential food imports to this country cost us only £50 million above our foreign investment income. In 1939, they cost us £200 million above the foreign investment income, and last year the comparable figure was £900 million. That means that since I was a boy, say 40 years ago, food imports have gone up until they cost us 18 times as much and for exports, allowing for the fall in the value of money, about 6 times as much.
§ Mr. Osborne
Oh, for goodness sake be quiet. If we are to import the foods that are necessary, we have to export a great deal more. I will give only one figure, which is of great importance and which we all ought to bring home to those whom we represent. Since 1938 the terms of trade have gone against us by about 33 per cent., which means that we have to export four articles for every three in 1938 to get the same amount of food as we had before the war, other things being equal. We talk about shorter working hours and easier times; but whether it is in engineering, shoes or textiles, we now have to make four articles where three would have done in 1938 to get the same amount of foodstuffs.
It is of the most vital importance that we should go to our people and, at least for a while, give narrow party politics a rest while we explain to them the dangers of our economic position. It is our duty to set out these difficult supply conditions, which are world conditions and which we, as parties, cannot affect. Until our people realise what we are up against we shall never get from them the effort that is required even to maintain our standard of living.
§ 7.54 p.m.
§ Mr. Frederick Willey (Sunderland, North)
I shall not endeavour to follow the arguments of the hon. Member for Louth (Mr. Osborne), save to say that I feel very sorry for him personally. I always understood in the last Parliament that it was the Labour Government that made him so gloomy, but he is now gloomier than ever. I make this invitation to him seriously. I invite him to 117 come to my constituency, and if he will only repeat there what he has said today nothing could be more embarrassing to his political colleagues who have spoken and will speak again in my constituency.
What shocks us about the present Government is the speed with which they are setting out to reverse the policy of fair shares which the Labour Government instituted. I will only say, about the general background as shown by the indices, that I asked the Minister to include the November figures because they are the figures as the cost of living stood on 13th November. The month runs back to the middle of October, so obviously that figure should be included. If it is included we find—if we compare like with like and not, as the Minister's Parliamentary Secretary did the other day, compare the increase in the three months of this year with the increase for six months of the Labour Government, but compare either the previous six months of the Labour Government or the corresponding six months of last year—that it is clear that the cost of living has increased rather more steeply under the present Government than it did under the last Government.
But there are these differences. This is rather a favourable moment for the Government to choose. We have had the increase in the cost of tea and meat and the seven increases against which we prayed last week. These are not shown on the published figures. We all know therefore—the Minister knows—that there is going to be a sharp increase this month and next month. Again there is this difference between the figures we are comparing: There has been a tremendous change in the position of international trade, so far as costs is concerned. There has been a revolutionary change, because the terms of trade are now running in our favour. So far as costs go, the position is that there has been a vital change since when the Labour Government held office.
A further point of difference is this—to touch upon something with which the Minister dealt. If we take the right month and the right six months for comparison, this is what has happened to the cost of living and the wages index: The cost of living has gone up six points and the wages index has gone up three. Under a Tory Government we have got 118 what we would expect, the cost of living outpacing wages by two to one. We also find, if we take the proper basis of comparison, that the increased price of food has played a much more substantial part in the increased cost of living than it did in the last Government.
The vitally important thing, however, is the difference in the attitude of the Governments towards the rising cost of living. I am trying to be impartial, and I will quote from an impartial source, The United Nations' Economic Bulletin for Europe, which said, dealing with the effect of the Budget upon the people of this country:On balance, all families with an annual income below £350, who represent one half of the total number of family incomes, will be worse off. Those with between £350 and £550, which represents about one-third of the total of incomes, generally "break even." The remainder of the population above this level will be substantially better off.That is what a Tory Government have done.
The Minister of Food, the last time we discussed this matter, justified this position by saying that it brought a greater sense of reality into the economic life of this country. What does that mean? Before the war, malnutrition had become such a well-recognised factor that we had several important and recognised surveys of food standards. The Lloyd figures show that if we take only five broad social groups, that before the war the highest group were consuming twice as much meat, twice as much sugar, and twice as much fats as those in the lowest group, three times as much eggs and fruit and from four to five times as much dairy produce.
The other recognised figures, those of the Crawford-Broadley survey, demonstrate that the difference between the expenditure on food between the highest and the lowest group was not less than 10s. 10d. per head a week. We had a lot of talk in the House in the last Parliament about meat. These figures showed that on meat, bacon and fish alone, those in the highest group spent 2s. 9½d. more per head and got 10 ounces of meat more than those in the lowest group. Those are not relating to extreme differences but only to five broad social groupings in this country.
119 When I was at the Ministry of Food we also had a food survey. What did it show? That the difference in expenditure between the top and the lowest group on meat, bacon and fish was not 2s. 9½d. but 4½d.; that the difference between the expenditure on food between the top and the lowest group, notwithstanding the fall in the value of money, was not 10s. 10d. but about 3s. We thought that was the right thing to do for the people of this country if, as the hon. Gentleman the Member for Louth says, we want everyone to work as hard as they could.
The Minister of Food and the Chancellor have not only torpedoed all this by slashing the food subsidies, they have exaggerated it by the very way in which they have cut the subsidies. What did they attack first? Bread and flour. And they have saved at the expense of the housewives of this country £48 million. What do the figures of Crawford and Broadley show? That there is only one foodstuff which the lowest group consumes more than the higher group and that is bread and flour. What a lot of nonsense about millionaires having food subsidies.
What did the Chancellor do? He saw Ito it that to recover the £48 million we would make the poorest of the poor make the largest contribution. What followed bread and flour? Tea. It did not need any statistics to tell us that the consumption per head of tea, like bread and flour, is higher amongst those in the lowest income group than in the highest income group because they have not alternative beverages. What does the Minister of Food say about the increase in the prices of tea? I quote the right hon. and gallant Gentleman:It will enable the trade to buy more expensive teas and it will be those more expensive teas which will in fact be subsidising the cheaper teas. … The higher priced teas are very popular in certain quarters and they will be subsidising the cheaper teas."—[OFFICIAL REPORT, 15th May, 1952; Vol. 500, c. 1662.]What a lot of silly nonsense. Nothing could be more untrue. Let us take it by stages. The "certain quarters" are the quarters which are "substantially better off" as a result of the Budget. Fortnum and Masons do not supply people in the East End? Are we living in the old days of Robin Hood with tea merchants attacking the rich to provide cheap tea for the 120 poor? They will sell at the highest price they can obtain on the market they happen to be selling.
Let us take the position of the next food increase. Having increased the price of bread, flour and tea, the Government increase the price of meat to recoup a further £48 million. Speaking before the price increase, this is what the Minister of Food told the Council of the Institute of Meat:The public, having been accustomed for the past 12 years to obtaining meat at an artificially low price … might react by reducing demand when the increased meat prices become operative.That is exactly what has happened. Now I quote what the meat trade said subsequent to the price increases:To increase the prices of the most expensive cuts by a greater degree than the cheaper cuts was out of balance. In working class districts traders were already having difficulty in selling the highest priced cuts. The new range of prices would create an impossible position in many shops.What are the meat traders saying? They are saying in effect that the Minister has destroyed fair shares in meat; that now the most expensive cuts and joints are going where they can be sold. I remember my right hon. Friend the Member for Easington (Mr. Shinwell) querying the Minister about this. Well, we in the North-East now will not get the best meat which we have hitherto enjoyed under the ration. The industrial areas will not now be able to afford it, and it will go to the select parts of the country. That is what is happening about meat, and the Minister has organised things so that this will happen.
I will give only one more example. In the previous debate the hon. Gentleman the Member for Newbury (Mr. Hurd), to whom we always listen with great respect on questions of food and agriculture because of the authority with which he speaks, in dealing with eggs and looking to the future said:We want the production of eggs to continue increasing and the price to be decided by supply and demand. We know pretty well what the price would be, because we know the black market price. It is nothing terrible."—[OFFICIAL REPORT, 15th May, 1952; Vol. 500, c. 1698.]I am not being unfair to the hon. Gentleman when I say that he is really asking for too much, because he also said that the farmers must have a support price so that they would succeed in any 121 rase. At present everyone is complaining of the shortage of eggs, although they are more plentiful than before the war. If the supply of eggs were to be determined by the law of supply and demand we would soon, particularly in the present deflationary period, be back to the days which the Lloyd figures revealed, when some people of this country would be getting three times more eggs than other people.
With this background, how hypocritical for the Chancellor to go along to the Trades Union Congress. To quote again from the United Nations Report, it shows that the action of the Minister of Food and of the Chancellor will increase the cost of living in this country by about 7 per cent. and that this will inevitably lead to demands for wage increases. But the Report also says that the recession in certain industries and the general deflationary atmosphere may make the resistance to wage claims greater than before.
The Chancellor knows that. The position at the moment is that in spite of these two adverse factors against increased wage claims we have the present increased wage claims. The unions have seen that the rise in the wage levels has lagged well behind the rise in the cost of living. They are not deterred by the present signs of recession but, in the interests of their members, they are driven to ask for some adjustment. Why does the Chancellor of the Exchequer intervene now? I have a great respect for the intellectual qualities of the Chancellor of the Exchequer—I say this with great sincerity—but I have a far greater fear of his political designs and purposes. I have not forgotten that it was the Chancellor who came into the House when other men gave up the task to defend persuasively and persistently the policy of appeasement of a previous Government.
§ Mr. Willey
What the Chancellor is doing is saying to the unions, "Hold your hand. Delay your claims and I, the Chancellor, will delay the further price increases that are inevitable from my Budget policy." The first question I ask the Chancellor is this: what further price increases will there be? I heard the Budget speech, and this is what the Chancellor said: 122This extra cost may well average out at about 1s. 6d. per week per head of population."—[OFFICIAL REPORT, 11th March, 1952; Vol. 497, c. 1299.]According to the Financial Secretary the present increases amount to 1s. 2½d. per week per head of the population. Does this mean that the Chancellor is saying to the trade unions, "We have imposed practically the whole of the increase but there is to be another 3½d."? The Chancellor did not delay in imposing the brunt of the increases, but apparently he expects the trade unions to delay because there is 3½d. outstanding. Does it mean, as we on these benches have suspected, that the price increases will be far greater than this?
I heard another figure today. I heard the Minister of Food say that the intention is that the food subsidies will amount to £310 million this year. He has already recouped on the three price increases in flour and bread, tea, and meat £109 million. He has recouped a further few million pounds on milk. That carries him well over the £410 million. There is the £50 million in respect of the farmers' and other increased costs. That does not mean very substantial price in increases, unless we are to have something very different from what we have been told so far, because we have to offset against those increasing food prices what the Minister also said, that the prices of some foodstuffs are falling and that there had been a catastrophic fall in freight rates.
We on these benches have been quite right in saying that the price increases are going to be much steeper than the Chancellor led us to believe, and that he is going to do what I suggested he would do some weeks ago. He is going to delay these increases until late in the year, so that to recoup within the present financial year he has to have very steep increases and so cut into the food subsidy for the following financial year, exactly as he did in the case of bacon and cheese.
But why, just at this moment, should the Chancellor make this appeal to the Trades Union Congress? This is the reason. In spite of the recession, this is disguised at the moment. For a month or two, we will not see any marked absolute increases in unemployment, because this is the period of increased seasonal employment. We must relate 123 the figure back 12 months, and people at work do not often do that. They regard the position as compared with the situation a week ago.
For a month or two, therefore, on the appearance of things, unemployment will be held, but not if we care to check the figures with those of 12 months ago. When we come to the end of that period, however, unemployment will sharply rise, because instead of being offset by seasonal employment, the figures will be aggravated by the onrush of seasonal unemployment.
Does the Chancellor think that the trade unions are fools? They know this better than he. They know now that the only way in which the Chancellor could make a real appeal to the trade unions is to say to them, however committed he may be, that he is willing to revise his financial policy, that he is sorry for what he has done and is sorry for the upset that it has caused to the economic stability of the country.
Right hon. and hon. Members opposite are in a dilemma. At the General Election, the Prime Minister and his colleagues repudiated Lord Beaverbrook. They said, although I do not need to repeat it because it has been argued so many times in the House, that they would not in present circumstances touch the food subsidies or the social services. That automatically ruled out any Conservative solution to our economic troubles.
The Government were in a dilemma. They could either renounce their past Tory prejudices, or they could renounce their Election pledges. What they did was to appoint as Chancellor the right hon. Gentleman, who so well had put their case during the disastrous months of appeasement. They thought that he would be able to be a true Tory and yet appear a new Radical, just as in 1938 he had disastrously betrayed the country under an appearance of internationalism and meeting other people's points of view, including Hitler's. One of the purposes that we on these benches have served is to reveal this policy so that people are not fooled, and in their revelation lies the doom of the Government.
§ 8.14 p.m.
§ Sir Ian Fraser (Morecambe and Lonsdale)
The hon. Lady the Member for Cannock (Miss Lee) said—I think I am quoting her fairly—that Labour did not want cheap food or cheap coal but believed in fair prices for these commodities and fair wages. I think that the hon. Lady was speaking for all of us in that.
I want to call attention to the fact that in the cost of almost everything in the world, including food, the cost of wages represents three-quarters of the whole cost. Therefore, when anything goes up in price, it is because, as regards three-quarters of that price, somebody is getting extra wages.
§ Mr. J. A. Sparks (Acton): Extra profit, the hon. Member means.
§ Miss Lee
The hon. Member quoted very fairly that I made the point that the standard of living was the important thing and that we did not want too cheap foods at its expense. I hope, however, that he does not associate me with his further point. It was only the other evening that we had a most interesting debate on the price of newsprint, and we are continually having reminders of just how much profit goes into those things and into the level of the price.
§ Sir I. Fraser
I was not taking advantage in any way of what the hon. Lady said. She agrees that I fairly quoted what she said, and I welcomed it. We are at one in that. I like to seek out the things in which we are one rather than to emphasise those in which we are at odds. I cannot help feeling that the people generally would be much more interested in what we can all do together to remedy our position than in the to and fro of blaming each other for this and that in the past.
It remains a general broad fact, although there are exceptions, that three-quarters of the cost of everything is wages. When, therefore, anything goes up in price, broadly speaking three-quarters of the rise is in respect of wages. I agree with the hon. Lady that we want fair prices and fair wages. If, therefore, wages go up, we must pay more for the things that are made by the people getting those wages. There seems to me no way out of that.
125 For 10 years or more, under two or three Governments we have had inflation. First, it was because of war, and thereafter because of policy, because the Keynes theory has dominated our economic thinking and our economic action. Inflation is a very agreeable thing, like dope and drink, for a great many people; they get used to it, it gets into their blood and they begin to find that they cannot do without it.
Wage earners get more money as inflation proceeds. Salaries become higher, and dividends, in so far as they are paid out on ordinary shares or represent the share of profits in partnerships and so on, also rise as time goes on, though more slowly. All these forms of income rise because they are paid in the new currency, which is depreciated, instead of being paid in terms—
§ Mrs. Jean Mann (Coatbridge and Airdrie)
On a point of order. It shows an amazing disrespect to the Committee, in a food debate, that there not a representative of the Ministry of Food on the Government Front Bench.
§ The Financial Secretary to the Treasury (Mr. John Boyd-Carpenter)
The hon. Lady sees fit to describe this as a food debate. If she looks at the Votes which the Committee are now discussing, she will see that a number of Departments, including the one which I happen to represent, have their Votes at issue.
§ Mr. I. O. Thomas
How many Departments are involved, and how many of them are represented by the two Members who are at present on the Government Front Bench?
§ The Temporary Chairman (Mr. Colegate)
That is not a point of order. Members on the Front Bench decide by their own wishes and on their own grounds whether they attend. They are perfectly entitled to do as they please.
§ Mr. Boyd-Carpenter
On that point of order—[HON. MEMBERS: "It is not a point of order."] On that purported point of order, I should like to have your Ruling, Mr. Colegate, as to whether the hon. Lady is right in describing as a food debate a debate in which a number of Votes other than those of the Ministry of Food are also included in the debate.
§ Mr. F. Willey
Before you reply to this purported point of order, Mr. Colegate, may I ask why there is no one from the Ministry of Agriculture and Fisheries, the Board of Trade and the Ministry of Labour and National Service on the Government Front Bench, because their Votes are also down for consideration?
§ Mr. Robert Crouch (Dorset, North)
Further to that point of order. Is it not the rule in the House that there is an hour on Friday, and this particular hour on other days, when hon. Members are in the dining room and when points of order about attendance are not raised?
§ The Temporary Chairman
This is a composite Motion which does not concern the cost of food only and there is really no point of order arising.
§ Sir I. Fraser
I am most grateful to hon. Members on both sides of the Committee for the intermission they have granted me in my speech. Now, perhaps, I may return to the point I was seeking to address to you, Mr. Colegate.
I was saying that inflation is welcomed by many wage earners and salary earners—or, if it is not welcomed, at least it is tolerable to many because they get compensation by the fact that they are paid and rewarded in the new depreciated currency instead of in terms of the old. But that is not true for a very substantial element of the community which has the misfortune not to be very strongly represented in the House.
There are some millions of people who have no employers' federation, no trade union and no one particularly to represent them or speak for them. They cannot withhold their labour and cannot, therefore, bring their needs so dramatically or so powerfully to the notice of Governments, of whatever party, as can organised groups. This question of the cost of living, whether it be in food, clothes, amenities, or enjoyments, vitally affects them. I rose particularly to say a word for them and for some groups amongst them.
They cannot remedy the position themselves because they are either too old, or too sick, or too disabled to do very much about it by taking thought or by special efforts. They cannot do an extra hour or two a day, or a bit of overtime once a week. They may not be in work at all 127 because they are disabled and, even if they are in work, they are in that sort of steady job which suits their disability but does not give scope for promotion or harder work. They cannot get greater reward or earn more money by their own efforts. Nevertheless, they are affected more by a higher cost of living than are the other active groups in the community whom I have mentioned.
Their claims on the community vary. They have no right to demand this or that; they can only ask that their neighbours and their friends will help them to sustain a decent life, a comfortable life and, in their old age, a pleasant life. They cannot withhold their labour and bargain with the community. The services they have rendered were in the past. They may have been notable in industry or in war, but they were in the past.
The only source of wealth is the wealth that the people make—the earnings of those by hand and brain—out of the soil, out of the chemicals in the ground, out of all the various skills possessed by men who use their brains and hands. That is the only source of wealth and the total wealth available is only that made by those people. If they have not enough wealth, or the right kind of wealth in their own island, they can exchange some of what they make for some of what others make, but it still remains the fact that the total wealth is only that which the people themselves make and only out of the pool of that wealth can any of us enjoy anything.
Some have claims on this wealth, claims arising from the past—the right to a pension, the right to superannuation. Others have no claims but the claim to consideration from their neighbours. It is my view that in this stage in our life as a community we have to induce in our people a belief in earning more by their own work. We have to discourage all those who do not work and encourage those who do work.
§ Sir I. Fraser
We must do the best we can to get them working. I do not wish to be diverted from my argument, which is an earnest and a serious one. Unemployment in this country is a very grave matter, especially in Lancashire, but at 128 present it is not a serious factor which will invalidate the argument I am putting forward. It is minimal by comparison with that experience in the past, save of course for post-war periods.
The only source of wealth from which all our needs and gratifications can be met is that which the workers make. Since that is limited and cannot quickly be altered, it is clear that we can only divide it up into certain proportions. I think that at this stage the most important thing of all is that we should give to those who make our wealth a little more of the national share. [An HON. MEMBER: "A lot."] I should like to give a lot more, but I believe in the inevitability of gradualness. We must give them a little more and always hold out the encouragement that there will be still a little more and, moreover, that they will be allowed to keep that little more and enjoy it themselves, and choose how they will spend it.
That philosophy seems to me to be the one which will encourage the limited number of people who make our living for us. We must remember, when taking into account children, wives, housekeepers and the old, that, although they bear great burdens of work for us, they do not make our wealth. It is a limited number of men and a few women between the ages of 16 and 60 who, broadly speaking, make the wealth of the community. If we can encourage that group, they will make more wealth for us. I believe that is the only way, in the end, by which to reduce the cost of living; that is why what I am saying is relevant to our debate.
I am not trying to make a party point here, but I do not believe—and I think the last six years have shown it—that price fixing, save in very rare circumstances of great national need, rarely leads to the great surge forward of increased production. I believe that better rewards for the individual are the way. It is because I think that we are approaching this attitude of mind in our present view of life that I think there is some hope that we shall get out of our troubles in the next year or two.
I believe that the wage rises of last November throughout industry generally have not yet found their way into our economy and, therefore, there are still rises in costs to be faced during the rest 129 of the year. I do not know what view the Cabinet Office statisticians take about this, but I think we are still in the period of inflation and that prices will rise generally, perhaps up to the end of this year.
It is possible, of course, that events in the United States and in the field of foreign affairs may stultify all prophecies, but it is my guess, for what it is worth, that that is what will happen this year and that next year we shall see a fall in prices. It is vitally important that we should continue to pursue a policy which will help to bring that about. Whilst it must be expected that the Opposition will exploit every rise in the cost of every commodity on the political platform—
§ Sir I. Fraser
Yes, as we did during the years before—that is to be expected. But I do not think people will take very much notice, because the General Election will not come for two or three years, and the time for getting fussed and bothered as to who is winning, and who is up and who is down in the Gallup Poll and all that, is not yet. Therefore, it seems to me that we must go on steadily—and this Committee and Parliament may rejoice that we shall go on—with this programme because it will greatly strengthen the position of the next Government, whatever party may be in power.
I have said already that those who cannot work to improve their position are the worst hit. They include the old, the sick and the poor, and also the war pensioners. I make no apology to the Committee for saying a brief word for them. Government statisticians, as well as statisticians at Oxford, London and Cambridge have shown that by the end of this year the basic wage rates in this country will have risen by two and a quarter times. As a previous speaker indicated, the money taken home at the end of the week is very often more than that, unless of course the person is unemployed, in which case it is less.
The pensions paid to a small number of war pensioners have increased by considerable sums—by two and a quarter or two and half times in some cases where their emoluments and allowances have been augmented by the Govern- 130 ment since the war. But for an overwhelming majority of them a much smaller rise has taken place.
I do not want to repeat all the arguments with which hon. Members on all sides of the Committee are familiar. I want only to remind the Committee that during the year we all ought to consider making adjustments in these pensions to meet the cost of living already registered, and below which I do not think living costs will drop very much. I have said that they will go up this year to the end of the year and then fall next year; but I do not believe they will fall below present levels. At the present levels, the basic war pensions of 1948 of 40s. a week should now be 90s.
I know that the whole national economic position must be taken into account in deciding whether this adjustment can be made or not, and whether it can be made at once or by stages; but it must be made if this debt of honour is to be paid. That is the point I want to leave in the minds of the Committee and of the Government, because this group, along with the old and the sick, cannot remedy their position by their work.
Sir Stafford Cripps fought manfully and courageously to teach our people some of the elements of the economic situation which have been gilded over in loose political thinking for so long. Up to a point he succeeded in teaching some of us on both sides of the Committee the fundamental facts. He tried very hard to stop inflation, but political pressures were too strong for him and he could not succeed. Now the present Chancellor of the Exchequer is trying, and he has introduced the first Budget that we have had for 10 years which has been designed for the purpose of stopping inflation, possibly creating a measure of deflation, and thereby bringing about a general fall in wages, salaries, dividends and profits and in prices all round.
I said those words advisedly, knowing that wicked men will take them out of their context and use them to their advantage on the political platform. The fall may not be absolute. It may only be relative. It may show itself in terms of a cessation of rising factors rather than falling ones. But there it is. It is the policy, as I see it, of the Government to bring about a better state of affairs for 131 all by causing a return to a situation in which we are paying our way and living on our earnings. I hope that will go on.
I believe that, given two or three years of steady, courageous progress along that course, we shall find that the cost of living will fall. But if we weaken and pander to the clamour from any quarter to save this or that commodity from rising a penny here or twopence there, hard as the grounds may be for such refusal, then all we shall do will be to return to the policy which in six years has produced this enormous rise in the cost of living.
I therefore plead with hon. Members in all quarters and even with the Opposition, who, as I say, need not get fussed for another two years, to let this fruitful policy go forward, because it will without question contribute very greatly to the better standard of living of our people.
§ 8.37 p.m.
§ Mrs. Jean Mann (Coatbridge and Airdrie)
I am very disappointed in this debate. I have been reading the newspapers over the weekend and gathering from the economists who write in such papers as the "Sunday Times" that we were really going to have an exceedingly good debate and that the Government were fully prepared to meet this challenge. Of course, there are economists of different points of view. If we took all the economists in Britain and laid them out end to end, they would all point in different directions.
I read that the Government had a watertight case to present today. After listening to speaker after speaker on the benches opposite, I am forced to the conclusion that there has never been such a sorry performance since that foolhardy individual went over Niagara Falls in a barrel. We have been told that because the Labour Government in one period of months increased the cost of living, therefore hon. Members opposite are to be congratulated for further increasing the cost of living in a given period of months. That is the point of view that they constantly present to us.
For some time, during weekends, I have been meeting housewives at meetings as far north as Inverness and as far south as Salisbury. The housewives tell me—and 132 it is backed by my own experience—that the Chancellor's statement that the increase in the cost of living worked out at 1s. 6d. a week was absolutely false. Indeed, if one examines the position, the increase has not yet even been placed on all the goods.
I have had budgets submitted to me from Inverness to Warminster. I have been told by people in the north that the increase in the cost of living is £1 a week for a family of five, and in the south a woman has submitted that the increase amounts to 16s. for a family of four. A man has told me that it is 15s. 9d. for a family of four. All housewives are very worried, except those in the Housewives' League, who have been flattened out by an overdose of anaesthetic administered by the Radio Doctor. I wonder how the Radio Doctor would like to broadcast now and explain the position to the housewives. How would he like to give them the explanation that we have heard today from the benches opposite?
Last week I put down a Question asking what was the cost of living arising out of the Budget changes and other changes operating since November, 1951, and the Financial Secretary to the Treasury gave this reply:… the cost per person per week of the normal ration is about 81d. more today than it was on 1st November, 1951. To this should be added about 6d. for the average increased, expenditure on milk, bread and flour."—[OFFICIAL REPORT, 26th June, 1952; Vol. 502, c. 201.]Yet, on the 11th June, the Parliamentary Secretary to the Ministry of Food replied that there were 27 different grocery items which had been increased in price. I think the number is 38; in fact, I am prepared to prove to the hon. Gentleman who was such a good broadcaster that there are 38 items of grocery which have been increased and that the increase to the housewife is not 1s. 6d. per head but 4s.
If we take the first item alone—flour, which bears an increase, on the hon. Gentleman's own showing in HANSARD, of 33 per cent.—it is listed as one item; but if flour is increased by 33 per cent., then rolls, bread, cakes and buns of every description go up in price. It follows naturally in relation to quite a number of the 27 items. To what do we attribute these increases? Hon. Members opposite 133 today have merely attributed the increases to the Budget changes, which were deliberate. They deliberately increased food prices by taking away the subsidies.
It was a deliberate act of policy. On the same day, 11th June, the Parliamentary Secretary was asked how many of these 27 items on which the prices had risen were those from which the Minister deliberately took price control as soon as the Government came into power. He replied:It would take a little time to sort them out. They certainly include flour, which is the one responsible for the 33 per cent. figure."—[OFFICIAL REPORT, 11th June, 1952; Vol. 502, c. 207.]The party opposite increased food prices on rationed goods and they increased prices again by taking away price control. Who was that benefiting? In addition, they were faced with the other reason for food prices increasing—the fact that prices had increased abroad. If hon. Members opposite knew that they were faced with this situation, with food prices still against them, where they would have to pay more for our food, was that not a reason, and an outstanding reason, why controls should still have been retained? In America President Truman retains controls. In France, controls have lately been imposed.
Surely the fact that food prices were steadily rising abroad was one reason for retaining controls and not loosening them, and a reason for retaining subsidies. But hon. Members opposite deliberately took two roads: one took the high road and told the public that food prices were going up by 1s. 6d., and the other took the low road and put the prices up by 2s. 6d. behind people's backs, thinking that they would never discover it. But every housewife knows it, and no wonder husbands have been told that £1 a week more is being spent for a family of five and 16s. for a family of four.
Hon. Members opposite have told us today about how prices have fallen for curtain cloth and drapery. Even carpet prices are falling, but hon. Members opposite do not see the danger, they do not see the course on which they have been steering this ship. It was always understood that when the captain got to the bridge of the ship "Britannia," whether at home or abroad, he would steer her clear of the rocks. This ship "Britannia," with the captain on the 134 bridge, is not so successful in foreign waters and is certainly making for the rocks domestically.
Unemployment in the textile industry is not caused by the withdrawal of the Australian exports. It is caused by loss of purchasing power among the people of this country. Today is the first day of the sales in London—a day when normally the women would be jostling each other to get hold of the bargains. What has happened? The shops are not selling at all. Even if curtain cloth, which was formerly 8s. 11d., is now marked down to 3s. 11d., it still is not selling.
I stood in Hartlepools the other day looking into the sales at the big shops which had marked down their goods. I never thought I should feel sad to see a fall in prices as I saw them in Manchester a fortnight before. I thought that when prices began to fall every woman would be glad to buy. It is a little sad to see prices one knows are uneconomic being advertised in the windows of the shops of Great Britain and, low as they are, still not attracting buyers.
My hon. Friend has repeated that the United Nations Bulletin says that a half of the population of Great Britain, that is to say, the people with under £350 a year, are worse off since the Budget—are worse off. For the cost of food alone £1 a week per family of five is taken, and that is £1 not being spent on textiles. The curtains can wait. Even if curtain cloth is being sold at the tempting price of 3s. 11½ a yard, even if dress material is down to the low figure of 2s. 11½d. a yard, it has got to wait, because so much of the household income goes to pay for food.
Does not the Chancellor of the Exchequer realise that his dear food policy which he has deliberately created is stifling the purchasing power of a half of our people. It is all right for the sixth part of the population who, the United Nations say, are substantially better off; it is good for them to get the bargains in curtain material, dress cloth, suitings and all the rest, but the people with £7 a week and under are completely unable to buy. It does not matter that carpets can be bought for £12 whereas they were £20 once, all the money going into the house goes to buy food.
That is the policy that hon. and right hon. Gentlemen opposite are pursuing. 135 It is leading—as it has led—to heavy unemployment. It is a policy that means that every wage increase will make it impossible for us to sell our goods abroad; if there are no wage increases it will mean vast unemployment. It was a sorry day that the people of this country returned a Tory Government.
§ 8.53 p.m.
§ Brigadier O. L. Prior-Palmer (Worthing)
I should have liked to follow in some detail the speech of the hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann), but I have not much time. However, I will take up one point with regard to the 1s. 6d. that she mentioned in the Budget. Surely she realises that that 1s. 6d. was specifically set against an increase in the cost of food as a result of the change in the food subsidies. I agree with the hon. Lady that there have been other increases as well, but if she was here—I do not know whether she was—when the Minister of Food made his opening speech, she must remember that he made two points.
One was that there were pending increases which the former Parliamentary Secretary of the Ministry of Food, the hon. Member for Sunderland, North (Mr. F. Willey) must have known would take place, and were taking place just before the Election, and which the Socialist Government would have had to accept if they had been returned to power. The second was the figure as the result of an increase in the reduction in the food subsidies.
§ Brigadier Prior-Palmer
Surely the hon. Lady will let me finish my sentence? After all, she has left me very little time, and I am supposed to finish by 9 o'clock. The other figure was one which inevitably would have been imposed even if a Socialist Government got into power.
§ Brigadier Prior-Palmer
I am talking about the normal price increases which were held back by the Labour Govern- 136 ment before the Election. Those increases would have had to be imposed whichever party got into power. I really cannot follow that argument any further.
I do not intend to indulge in this statistical ping-pong that has been going on across the Floor of the Committee, except to say that, as one who sometimes watches boxing matches, in my own mind, without having scored the points, I have a feeling that we have won easily, anyhow up till the final round, and I have sufficient respect for my hon. Friend the Financial Secretary to be confident that he will win the last round.
Today we have been discussing the background to this problem. It is not a new one; it will continue for many years. The standard of living has been rising all over the world, and there is one question I ask of the former Colonial Secretary. Of course, we must do everything in our power to raise the standard of living of people in the backward areas, but until they provide markets for our exports, will our people agree to a lessening of their own standard of living in order to raise the standard of living of those in the backward areas? I think they should, but will they do it?
There is bound to be an interval between the time the £400 million, or whatever it is, is paid out and the time the standard of living of these people increases. It is a perfectly good long-term policy, but our people will have to suffer while it is happening. Are they prepared to do it? Would any hon. Member go to his constituents, miners, textile workers, or anybody else, and tell them that they must give up a certain degree of their standard of living?
§ Dr. Stross
Many hon. Members on both sides have told their constituents that and have experienced no resistance to it.
§ Brigadier Prior-Palmer
I am delighted to hear it.
On the question of world prices and bulk buying, I would only point out that we are bound to pay world prices. There is no getting away from that. No other country will subsidise our food for us. What I object to is paying more than world prices. Let us clear our minds on this question of bulk buying. That expression is often used on political platforms, and hon. Members opposite do not seem 137 to realise what we on this side of the Committee stand for in this respect.
Bulk buying is not objected to as such. [Laughter.] That shows how little hon. Members opposite understand. What we object to—and I shall go on saying this—is buying between Governments, which becomes a political matter. If the buying of meat, or anything else, is handed back to private enterprise, they will buy it in bulk because that is the cheapest way to buy, but buying between Governments sets up all sorts of political reactions.
I have had to scrap a lot of my speech because of the shortness of time, but I should like to say that I took very great exception to one thing the right hon. Member for Easington (Mr. Shinwell) said in the middle of his speech, which was to justify any wage claims in the next six to eight months. I honestly believe that he cannot possibly be doing the trade union leaders any great service in saying that. He knows perfectly well that they are trying to restrain those demands, and if he, a former Minister, encourages wage claims he will assist the small minority in the trade union movement who want to see the disruption of this country, and who are working for that. I think that was a very dangerous thing for the right hon. Gentleman to say.
We have heard a lot today about the price increases as a result of cutting the food subsidies, and one thing and another, but not one word from hon. Members opposite about what will happen in September when the increased family allowances begin. When hon. Members opposite go to their constituencies for the weekend, do they remind the people that increased family allowances are coming in. increased pensions have been brought in, and the fact that the reduction in P.A.Y.E. has only just taken place for one week?
I think that it is high time that we stopped all party politics in this matter and got down to brass tacks; that we talked about what the situation really is and how we can get over it. I am not speaking on my own subject tonight, but hon. Members will realise that when I was on the other side of the House I always endeavoured to make constructive speeches, and I am trying to do so tonight, without bringing in party politics.
What we want is for every Member of this Committee and for the leaders of 138 industry and the shop stewards to tell the people what in fact is the situation and what is the truth. For heaven's sake, let us get rid of this class-warfare preaching. I mean that from the depths of my heart, and I dislike the phrase used by an hon. Friend of mine today when he referred to the "two sides of industry." The sooner we get rid of that idea, the better for this country. We want a team working towards one end, in the same way as the British Army threw a bridge over the Rhine in just over 18 hours. That was not done by the officers standing by with whips and flogging them on. They took off their coats and worked with the men. That is what we want today.
However much we may dislike it, I believe that we have ceased to be the middle men of this world, and therefore, having regard to a lot of other things which I should have liked to mention, I think that we cannot continue to support on this island 50 million people. I believe that, whatever Government is in power, it must inaugurate a large-scale emigration scheme, with all overheads, including granny and the children, to the most glorious climates there are in our Empire where there is room for expansion, both strategically and from the economic point of view. That, in the end, will be the solution of our problem, and the sooner it is done the better.
§ 9.3 p.m.
§ Mr. A. G. Bottomley (Rochester and Chatham)
This debate has been extremely useful. There have been some very fine contributions from this side of the Committee, particularly that by my hon. Friend the Member for Sunderland, North (Mr. F. Willey), and some revealing speeches from the other side, particularly that by the hon. Member who said that food was too cheap. We on this side take the view that the cost of living is a very important factor in the lives of every one of us. We think that it particularly affects the poorer section of the community—the old age pensioners, the disabled and others. We stand for shifting their burden. The party opposite used to accuse us, when we were the Government, of soaking the rich. I think that we can in truth retort that the Government today is protecting the rich. [An HON. MEMBER: "Soaking the poor."]
139 I have never been one who believed that costs would not rise whatever Government action was taken. The reason is that the primary producing nations of the world are becoming developed. There is a drift from the land. Not so much raw material and food is being produced, and what is being produced is being consumed by the developing countries, and there is less for export. The world population is growing also.
I remember, when I went to the West Indies last year, a leading member of their Government saying, at the end of my tour, "Mr. Bottomley, you have a Welfare State in your country. The people are reasonably well-fed. The children go to school and are well-clothed. We have a few in that very happy position, but the majority are not. We are going to ask you for more money for your food so that you can do for us what we did for you in the past and help to build our country." So we shall find that the cost of living must continue to rise as long as we have to import so much.
We import nearly all our butter, three-quarters of our cheese, sugar and wheat, half our meat and equally high proportions of raw materials. The Conservative Party always blamed the shortages and rising costs on the Labour Government. That was wrong. I do not now wish to complain of the way the Conservative Party used to blame us, but I will say that when we went out of office we left stocks. Right hon. Gentlemen opposite have said that the cupboard was bare. The Chancellor himself has given the lie to that, for in his Budget statement he said the Government would have to draw upon £150 million worth of stores, stockpiled by the previous Government. That has been confirmed by other responsible Ministers and by the Prime Minister himself.
Let us compare that with 1945 when the Labour Government came into office. The cupboard was really bare then. The Americans had been told by the Prime Minister that the country was bankrupt and that any Government which took over would meet the most serious difficulties. I would remind hon. Members opposite that in 1945 we had a points system for jam, cereals, tinned fruit and such things. If one decided to 140 have tinned fruit one had to go without the other things because too many points were required. If we compare 1945 when the Labour Government took power with 1951 when the Conservatives took power, there is no doubt who were the better off. The present Government were far better off.
Let us see what happened when the Labour Government came into power. The Labour Government did not grumble about these things; it accepted them. We had been through a terrible war. The Labour Government took its coat off and got down to the job. Reference to what had been achieved was made in the national Press in May, 1950, a month before the outbreak of the Korean war. The "Daily Herald" and the "Daily Telegraph" gave a very reasoned survey. The independent Conservative newspaper, the "Daily Express," really went to town. The "Daily Express" came out with banner headlines on 25th May, 1950. It said:Britain's business is booming. … Never before have so many goods rolled off the production dines in the factories. … Exports are higher than ever before. … Never before have so many people been in work. … Never before have savings been so high. … Agriculture and industry share in the bumper times.That is what we did after five years of the Labour Government, and we are entitled to take some credit for it.
It would be wrong of me to say that prices had not risen in that time. About that time prices in this country were double what they were pre-war. But what had happened in countries where there was free enterprise, in which the Government believes? In France prices had gone up 18 times and in Italy 50 times. In the vital years 1949–51 when world movements caused rapid increases in prices in Austria prices rose 20 per cent., in France 21 per cent. and in Denmark 16 per cent., while in this country, with a Labour Goverment, they rose 5 per cent. Although we had great difficulties we were not unmindful of our responsibilities to others. At that time we were exporting food to India and Continental countries who were in need.
§ Mr. Baldwin
Can the right hon. Gentleman say whether food subsidies were operating in the countries where prices had risen?
§ Mr. Bottomley
I was saying that we were sending food to those countries because they were in need. The question of prices did not enter into it at all.
There are two ways of dealing with the problem of the cost of living. One is that pursued by the last Labour Government and the other is that which the present administration are pursuing. What did we do? We strongly supported what the wartime Government had introduced, the Utility scheme, and by that means 70 to 90 per cent. of essential goods carried no Purchase Tax and were up to standard specification. In the matter of maximum price control, the Co-operative societies of this country set a magnificent example. They put their prices below the maximum, but I regret to say that private enterprise did not follow suit.
§ Mr. Bottomley
I do not want to generalise, but it is not untrue. When we were the Government we recognised that we had to tackle the cost-of-living problem. Hon. Members opposite can look at their files and they will see papers dealing with price maintenance, monopolies, marketing and distribution. If the Government had given their attention to these things and brought them forward, they might have been able to control the rise in the cost of living.
Then, we believed in food subsidies. Judging by parts of the speeches of hon. Members opposite, and particularly that of the Minister of Food, they favour complete abolition of the food subsidies. The argument was used that food subsidies are given to rich and poor alike. I should like to follow that up and ask whether the Government accept that as a principle. If so, what about the subsidies to the farmers? They are given to rich and poor alike. What about family allowances, which also go to rich and poor alike? Food subsidies are the way in which the poor people get the food they require. It is most important that they should get it, because good food enables them to have good health and we have not to spend money unnecessarily on getting them better. Further, giving them good food ensures that they are able to do better work and increase production.
§ Mr. Spencer Summers (Aylesbury)
Surely the right hon. Gentleman is over- 142 looking the fact that subsidies to the farmers are taxed whereas the food subsidies are not?
§ Mr. Bottomley
I am coming to that in a moment. As far as the food subsidies go, the answer to the people who are concerned about the rich getting their share is that if those people are feeling squeamish about it they should console themselves in the knowledge that they are paying for it by the Excess Profits Tax and by Income Tax.
Before the removal of the food subsidies prices of essential foods began to rise. Cheese, bacon, biscuits, milk, marmalade and things which the poor people buy—they cannot go in for the delicacies like the richer people can—showed an increase, but the steepest increase of all was that on bread. Tonight I was having a snack in this building and I spoke to one of the ladies who was serving. She told me that she spent 4s. 9d. a day on bread and milk. I do not know what the wages are which are paid here, but that is a pretty good slice out of anyone's weekly income.
Tea is a commodity which the poorer section of the community require. When the Labour Government were in office there were two increases in the price of tea. The first was in January, 1947, when subsidies were running at the rate of £324 million a year and the world prices of tea were rising. The second was in May, 1951, when food subsidies were running at £410 million a year and prices in the world again were rising. We have had an increase in tea recently at a time when subsidies are running at about £250 million a year and world prices are falling.
I read in a paper a week or so ago that roughly 4½d. per head of the expected loss of 1s. 6d., to which the Chancellor has referred, as a result of the removal of the food subsidies, is operating to date. In other words, there is still Is. 1½d. more to come. I think it is more than that, because prices are going up irrespective of the cut in the subsidy rate. Perhaps the Financial Secretary will give us an assurance that there will be no increase in food prices until pensions and other increased benefits are given to the people in September.
Another method which the last Government employed and on which the last hon. Member who spoke had some comment to make, was bulk purchase, in 143 which we believe, although we are not doctrinaire about it. [HON. MEMBERS: "Oh."] Indeed, not. In the case of tea we saw that there were very powerful arguments for giving it back to private trade. We gave it back to private trade. The present Government tried to claim credit, but we did it when we were the Administration. Most countries who sell foods now—and this applies particularly to Commonwealth countries—say, "Let us have a long-term contract because it enables our producers to get an economic return." That is probably the only way in which we shall be sure of getting our essential foodstuffs and raw materials in the future.
I was the Secretary for Overseas Trade in the last Government. We did not just send overseas civil servants to do the buying. There were public-spirited businessmen who were prepared to go with the team and use their expert knowledge to get the best deal for the country. When a team went out to bargain about the price for a commodity, we knew that the particular country was short of petrol, or coal or locomotives, for example, and the team were told about these things. By that means we were able to get very good deals.
We could not trust that process to private interests in the same way. Many other countries do not have the same trading standards as ourselves. What would be the position if we sent out a dozen private merchants to Argentina and asked them to bid for meat? They would be bidding one against the other, with the price always going higher, until in due course the maximum price would be paid for the meat. That would be a far more expensive way than we have at the moment. I did this kind of work in the last Government. I should like to read to the Committee what the Economic Survey of the United Nations' Mission for Europe said, as a result of impartial examination in these matters. It is:On the side of imports, the price advantage was almost exclusively due to the favourable terms that the United Kingdom was able to negotiate under its various bulk-purchase agreements.I should like to ask a question or two about whether the present Secretary for Overseas Trade is really able to do his work. When I was in the Department, 144 hardly a week went by when I did not meet some foreign trade leader or commercial representative. I do not complain about the poor Secretary for Overseas Trade; my argument is against the Government themselves. They have had two changes in a very short time.
There are at present trading difficulties with Brazil and Denmark. I would like to know whether the responsible Minister is handling these matters personally, and whether he is carrying on talks at the moment with the Soviet Union, from whom we want the timber and grain which are vital to enable us to keep our economy going. Perhaps the Financial Secretary to the Treasury will tell us something about these matters.
Now I would turn aside and look at family budgets. After all, the family is where the cost of living reflects itself. I have many examples from workers in industry generally, pensioners, and other people who knew I was taking part in this debate and who have sent me statements about their income and how the cost of living presses upon them. I have chosen one example, that of a public employee, an executive officer in the Civil Service. These officers are not poor people and they have reasonable conditions of employment in the Civil Service. They are not subject to the same fluctuations as other workers, and, by the very nature of their work, they are accurate.
This is the budget of a young man of 29, who is married and has one child. He tells me the comparison between October last, when the present Government took over, and today. This is the position: On 1st October last year he paid £10 8s. 3d. for his mortgage. There has been no change in that monthly figure—the Bank rate has not yet caught up, but it will do so. Rates were £1 19s. 2d. in October last; they are £2 0s. 3d. today. Food for the household in October last was £10 a month; today it is £16 a month. Clothing was £1 last October; it is still £1 today. Meals out were £4 7s. in October last; they are £4 15s. today. His fares were £2 18s. 6d. last October; they are £4 1s. today.
I have taken the trouble to get the details and to work out an average over all these budgets, showing the rise in the cost of living since the present Government took over. Rents or mortgage and 145 rates have gone up on an average 8 per cent. Food and household expenses have gone up on an average 16 per cent. Fares to work have gone up on an average 30 per cent., meals out 10 per cent. These are the budgets of people who are meeting the cost of living.
I do not want to weary the Committee with too many figures, but the best evidence that people have not the amount of money to spend today that they have had in the last three years is that for the first time in the three months of this year, taking Trustee, National Savings and Post Office Savings together, there has been a decrease in the amount of money accumulated.
As the Committee knows, I am by profession a trade union officer. My work in the House has prevented me from doing that work for some time, but I can say with truth that those colleagues of mine have shown by their example that they love their country, that they are prepared to make sacrifices. However, one has to acknowledge that their job is to protect the interests of their members to secure improved wages and conditions of service.
The responsible trade union leader is aware that in present economic circumstances to press for wage increases resulting in higher costs of goods sent overseas, thus making it more difficult to sell them, would have repercussions which would affect us all. Equally, however, they have to say to themselves that the policy of the present Government differs so much from the policy of the previous one that while they were right to say in the case of the previous Government that they would get their members to exercise wage restraint, they cannot do it now.
They said to the Chancellor when he first took office that they would not make any difficulties for the new administration although it was Conservative. They said they would do all they could to help. The Chancellor has acknowledged that. So the trade unions have done their best. The man really responsible, and who has a lot to answer for, is the present Prime Minister. If, when the Labour Government was in power, he had made the kind of speeches he is now making, calling for a national effort, we would not today be in our present difficulties.
146 The right hon. Gentleman said, "Set the people free." It has been shown by the policy of the present Government that what setting the people free really means is freedom for the vested interests and control for the trade unionists. Well the trade unionists will not have it. They gave the Chancellor a reasoned statement before he presented his Budget. What happened? No notice was taken of it or, if any notice was taken, no concessions were given, no points were met. Yet the private interests who pressed for the denationalisation of steel and road transport, and the brewers who wanted to go into the new towns—all those claims were met with alacrity.
So the T.U.C. feels that it has not been justly treated on the question of food subsidies and the Purchase Tax, and it has made it quite clear that it expects the Government to do something about reducing the cost of living. If they can do that, then the T.U.C. will be better able to go to its members and say, "In the national interest it is better not to press for wage applications." What the T.U.C. wants to see is a reduction in the cost of living, and it expects this from the Government, because they said they were going to do it, and they should do it.
There are two ways of solving this problem. One is by increased production. Nobody will deny that the last Government provided full employment and increased production. The other way is by import cuts.
§ Mr. Bottomley
I will put the hon. Member right. The other way is by import cuts of cotton, metal and things of that kind. If we do not buy the cotton, there is unemployment in Lancashire. If we do not buy the hides, we have unemployment in Norwich and Kettering and elsewhere.
§ Mr. Bottomley
if we do not buy the metal, we have unemployment in Birmingham and in the light engineering industries in the South of England. Therefore, we do not spend so much currency, and in addition, we make unemployment in those areas. It is well known 147 that the labour content of any manufactured article is particularly high. John Lewis's have already said that there is to be a cut in wages. Under full employment, those cuts can be resisted, but with unemployment people either take the job at the money which is offered or they go to the employment exchange and take a chance.
It is very surprising that the Prime Mnister, who not many years ago was Chancellor, said something which is quotable, but I prefer for this purpose to take an extract from that publication by Keynes, "The Economic Consequences of Mr. Churchill," in which he said:No section of labour will accept lower wages merely in response to sentimental speeches. We are depending for the reduction of wages on the pressure of unemployment, strikes and lock outs, and in order to make sure of this result we are deliberately intensifying unemployment.It is significant that the Prime Minister, who was Chancellor then, is the Leader of the present Administration. We have a right to know whether that is the policy of the Government. They certainly seem to be following it by their examples already.
What we say to the party opposite is that we expect from them some statement as to why they made their election broadcasts. I have a note of one by the Parliamentary Secretary to the Ministry of Food. I quite expected him to resign. This is what he said:For years I had some doubts about the Conservative Party … But in the past 18 months, as a Member of the House of Commons, I have seen things for myself. The party has been liberalised; it has got a real belief in human welfare, in freedom, in full employment and in the social services, and it is a lie to pretend that they want to cut them down.The Committee know—at least, on this side—and the country knows that the policy that the party opposite is following is one which is in opposition to all their statements. We have a right to expect the resignation of the Parliamentary Secretary.
Therefore, I ask the Financial Secretary in his reply to give us what he, with the rest of his party, gave at the time of the General Election: the statement on how they are going to keep full employment and reduce the cost of living. Already we are aware by the speeches 148 we have heard that we shall not get satisfaction. The Minister of Food has failed considerably, and I shall move that we have a cut in his salary of £5.
I therefore beg to move, "That Item Class IX, Vote 7, Ministry of Food, be reduced by £5."
§ 9.29 p.m.
§ The Financial Secretary to the Treasury (Mr. John Boyd-Carpenter)
Until the last few minutes of his speech, the right hon. Member for Rochester and Chatham (Mr. Bottomley) made a much more agreeable and helpful contribution than did his right hon. Friend the Member for Easington (Mr. Shinwell) in opening the debate. The right hon. Gentleman's speech, when contrasted with that of his right hon. Friend, underlined the fundamental dualism of the party opposite. I fully understand the manifest reluctance of the right hon. Gentleman to move the reduction which he knows perfectly well is justified neither on the run of the debate nor on the conduct of policy by my right hon. and gallant Friend.
The right hon. Member said—I took it down—"With reference to the development of colonial territories, a rise in the cost of living necessarily must go on as long as we depend on imports." I am not sure that I personally would go so far as the right hon. Gentleman, but that was a generous and reasonable comment, wholly contrary to the comments made by a number of his hon. Friends who denounce every increase in the price of every item in the cost of living index as being a grave injury to some section or other in this country.
The party opposite really cannot have it both ways. Either they must take the attitude of the hon. Lady the Member for Coatbridge and Airdrie (Mrs. Mann) and say that, cost what it may to this country or the other countries, the cost of living must not in any circumstances rise, or they can take the attitude of the right hon. Member for Rochester and Chatham and say that there are other considerations to be borne in mind.
I must, however, correct the right hon. Gentleman on another point. In suggesting that the present Administration inherited advantages denied to its predecessor at the time it took office, the right hon. Gentleman referred to stocks of commodities. He must have known that 149 that was one part, and the lesser part, of the picture and that at the time my right hon. and gallant Friend assumed responsibility for policy he took over from the previous Administration a grave and growing drain on the gold and dollar reserves of the sterling area, about which the right hon. Member for Leeds, South (Mr. Gaitskell) now prides himself on having given a warning before the Election.
It is not good enough for the right hon. Member for Rochester and Chatham to come forward and say that everything was easy for us because they left stocks behind, while ignoring the fact that the means to produce and replace those stocks were very exiguous and that a situation was left behind in which it was quite obvious, as the right hon. Member for Leeds, South has confirmed, that imports would have to be cut. I say to the right hon. Member for Rochester and Chatham, as one who admires his debating style, that, manifestly, to give us one side of the picture whilst excluding the other is not really playing quite fair with this Committee.
I also thought that the right hon. Gentleman was a little less than fair when he referred to the increases in the prices of cheese and bacon which my right hon. and gallant Friend imposed last autumn. If the right hon. Gentleman had cared to inquire into the matter, he would have realised that those increases were required, not to implement the policy of the present Administration, but to keep the total of the food subsidies within the ceiling imposed by the right hon. Member for Leeds, South last year.
It is a fact that, in order to carry that out, the prices of those commodities ought to have been raised some months earlier. If they had been raised some months earlier they need not, perhaps, have been raised so high, and my right hon. and gallant Friend would not have inherited the necessity to impose those increases. He had to do so in order to carry out the policy of the former Chancellor of the Exchequer and as a result of the delay of the former Minister of Food in not raising the prices at the right time—a circumstance perhaps not wholly unconnected with the last General Election.
I should like to answer the direct question which the right hon. Member 150 put to me. He asked about the further increases for food. The position is that with the 1½d. which will be added as a result of the increased price of milk which comes into effect tomorrow, 11d. of the 1s. 6d. forecast by my right hon. Friend will have been reached.
§ Mr. Boyd-Carpenter
I do not know why the late Minister of Defence feels it necessary to be scornful about the Royal Marines. What the Marines say about the right hon. Gentleman is another matter.
§ Mr. Shinwell
The hon. Gentleman has said that what the Marines say about me would be very interesting. I challenge the hon. Gentleman here and now, or at any future date, to give any evidence that anybody associated with the Royal Marines has said anything derogatory about me.
§ Mr. Boyd-Carpenter
I respond. A very distinguished member of that Corps, my hon. and gallant Friend the Member for New Forest (Colonel Crosthwaite-Eyre) has said a great many things about the right hon. Gentleman.
As I was saying, when the right hon. Gentleman interpolated that very cogent interruption, the 11d. will be reached tomorrow, leaving 7d. It is my right hon. Friend's intention to postpone the increases amounting to 7d. until some time in the early autumn when they will coincide with the increases in the compensating social benefits, as my right hon. Friend the Minister of National Insurance has already announced.
§ Mr. F. Beswick (Uxbridge)
Would the hon. Gentleman apply that also to the consequential increases which will follow on the cost of manufacturing pastry and confectionery because of the increased price of sugar announced last week?
§ Mr. Boyd-Carpenter
I am referring, as the hon. Member, who I know is familiar with the subject, is aware, to the effect of the subsidy adjustments upon the subsidised articles, rationed and unrationed, bought by the housewife. It covers all of them. As the Committee is aware, there will be compensations to assist those sections of the community which otherwise might have some difficulty in meeting the increases, and during 151 the period of the late summer and early autumn when those compensations come into effect, or at substantially the same time, my right hon. Friend will make his adjustments in food prices.
I agree entirely with the right hon. Member for Rochester and Chatham that this is a very great issue. The cost of living cannot be separated from, it is indeed a function of, the general well-being of our economy, and indeed, the general well-being of the international economy. It is really not possible, as some hon. Members seem to believe, to isolate the cost of living from all the various economic forces, favourable and unfavourable, which are operating in the world today.
If I may, I would ask certain hon. Members, who have sought to pinpoint their speeches on the narrow issue of the increases on certain foodstuffs, to bear in mind that those increases are themselves directly related to the whole economy of this country and also directly connected with the efforts being made to restore that economy.
The debate has been to a very considerable extent concentrated on food, but it deals of course—as it was necessary at one time to point out to the hon. Lady the Member for Coatbridge and Airdrie—with the whole question of the cost of living, and if we are to judge properly of price movements and their effects on our people we must look at those movements as a whole. Food is, of course, an immensely important item. I should be far from disputing that. In the latest cost-of-living index the weighting given to it is 40 per cent.
I recall that in the course of the debate one or two hon. Members, including, I think, the hon. Member for Hammersmith, North (Mr. Tomney), criticised the actual construction of that index. I am board to point out that that index was constructed with the assistance of an advisory committee appointed by the late Administration and included among its members one of the most prominent trade unionists in this country. It is based upon very careful research and, in my view, undoubtedly it gives a fair picture of consumption.
It is important to recall that there is still outside the food zone some 60 per cent., and if we are to judge of the effect 152 of alterations in food prices upon the well-being of our people we cannot disregard the movements that are taking place over 60 per cent. of the money that they spend. There are within that 60 per cent. certain individual items, such as fuel and transport, which are tending to rise, but generally the prospect over the whole of this 60 per cent. is encouraging.
The post-Korean rise in world raw material prices has now been fully reflected in the price of our manufactured goods. The wholesale price index of basic materials used in manufacturing and obtained mainly from abroad rose by 75 per cent. from June, 1950, to March, 1951, but it is now 25 per cent. below that peak, as the downward movement of last summer has been renewed during the last two months. That should mean that we are reasonably certain of fairly stable retail prices for manufactured goods for several months.
This is borne out by the actual price movements of clothing and household goods, about a quarter of whose cost represents the cost of imported raw materials. Clothing figures ceased to rise in December, compared with an 18 per cent. rise in the previous 12 months. Prices of household goods have stayed roughly the same since August, compared with a 22 per cent. rise in the 12 months before that. If developments are not affected by large wage increases, we really can look forward to reasonably stable, and in some cases falling, prices for about 60 per cent. of the goods and services which the ordinary person in this country uses.
It is not unimportant in this issue to bear in mind that that is the prospect in respect of the goods on which go 12s. of every £1 spent by the average family in this country. That is a very important factor to be borne in mind, not least in connection with those matters of wage claims to which reference was made by one or two hon. Members.
One would really think, to listen to some of the speeches in this debate, that the cost of living had remained low and stable until last October and had suddenly rocketed. In fact, hon. Members opposite will go down to history as a Government under which for six years there was all but a continuous rise in the cost of living. Therefore, if there is any force in their argument that Governments 153 should prevent rises in the cost of living, then they are bound to explain why it is that during the six years in which they enjoyed untrammelled powers in this country the cost of living rose year by year.
In the period between their taking office and—with a certain degree of expedition—quitting it in October last, the total rise amounted to 40 per cent. I think it might be of assistance to the Committee if I gave a comparison. Between the time this Administration took office and the end of May the rise in the general cost of living index figure was 5 per cent. For the exactly comparable dates in the previous year—during the Administration of right hon. Gentlemen opposite—the comparable figure was 8 per cent.
It really is not possible for right hon. Gentlemen opposite to say that in their case the rise was the result of inevitable world forces whereas in our case it was the result of our policy. That simply will not wash, because financial policies must be looked at as a whole and judged by their results, and if one forces up prices by an inflationary financial policy it really is no sufficient excuse to say that one did one's best to bring them down a bit by a high level of food subsidies. It is rather reminiscent of the man who was ordered by his doctor to take a cold bath and who took his usual hot one and put a lump of ice in it.
The Committee may recall that under the late Administration the people concerned paid in both ways. They paid in steadily rising prices and also in taxation to finance the subsidies which failed to prevent that rise in prices. We, at any rate, have given to 16 million earners the right to retain and spend, as a counterbalance to rising prices, a larger proportion of what they earn.
The right hon. Member for Easington and one or two other hon. Members opposite referred to extravagant statements supposed to have been made by my right hon. Friends on this subject. Right hon. Gentlemen opposite really must not adopt so aggrieved a pose of injured innocence. Right back in the 1945 General Election one of the most prominent figures of their party—now, unhappily no longer with us—told the people:Labour will protect your savings against rising prices,154 just as in their manifesto—"Labour believes in Britain"—published in 1949, the party opposite said:Labour will continue to restrain price increases."To continue" in that expression has a certain delicate irony.
The right hon. Gentleman the Member for Llanelly (Mr. J. Griffiths) in the debate on the National Insurance Bill on 6th February, 1946, said:The House will be aware that the Chancellor of the Exchequer has expressed the Government's intention to hold the cost of living at about 31 per cent. over the September, 1939, level."—[OFFICIAL REPORT, 6th February, 1946; Vol. 418, c. 1742.]That would seem to be an extravagant statement compared with which the observations of one or two of my hon. Friends are perhaps not of very great interest. In 1950 the right hon. Gentleman the Member for Lewisham, South (Mr. H. Morrison) said:Now I come to what is one of the most urgent problems for everyone and every housewife—the cost of living. We shall make a forthright attack on excessive prices.Did the right hon. Gentleman then know that the most rapid rise in the cost of living lay immediately ahead?
The charge which has been made by a number of hon. Members opposite—and one which calls for serious attention—has been that the action which my right hon. Friend took in connection with the food subsidies upset stability and therefore was likely to produce repercussions which all hon. Members would deplore. I think that accurately sets out the serious argument which was put, and I should like to analyse it for a moment, if I may.
In the first place, let us get it clear that the mere keeping of the food subsidies at the ceiling imposed by right hon. Gentlemen opposite—£410 million a year—would not have given stability. If the food subsidies had been fixed at that level, substantial rises in food prices would have followed. I suggest to the Committee that there is no peculiar sanctity about that figure of £410 million, which, as hon. Members know, was arrived at largely by accident. But the practical point which I would urge upon hon. Members is that even by retaining that figure, we should not have obtained the stability which hon. Members opposite say we have destroyed by our adjustments of the subsidies. The only effect 155 of retaining that figure would have been to lower the place on the scale at which the increases in food prices were taking place.
To put it brutally, there was no stability to upset. The only way in which stability could have been obtained would have been by a large increase in the subsidies. Is that what is now advocated by the Opposition? If it is, then I am bound to point out that the right hon. Member for Leeds, South, in what I think was the last speech he made from this Box, on 26th July, vigorously argued against any such action. Unless it is disputed, I take it that an unlimited increase in the food subsidies so as to maintain stability is not even now urged from the benches opposite.
If that is so, we are then simply in this position: assuming that the rises must take place and that the cost of stability is too high, it is a pure matter of judgment at what particular point one fixes the subsidy level. On that basis let me read to the House some very sensible words.
§ Mr. Boyd-Carpenter
In a debate opened by the right hon. Gentleman, it undoubtedly will be. Let me read these words:This year—and we must face this—if we had spent another £100 million in subsidies, it would certainly not have prevented a steep rise in the cost of living index. The difference that it would have made would have been only about 2½ points. Can anyone really suppose that this would have made a crucial difference in achieving stability? But to pay for it, of course, would have involved a further increase of 6d. in the Income Tax at all three levels. If, on the other hand, such an increase in subsidies, as I claim, could not be relied upon to achieve greater stability, then surely they must be compared as a matter of social policy with many other claims on the Exchequer, especially in the field of social services, such as higher pensions and an increase in family allowances, both of which are fairly closely related to need and are at least subject to taxation."—[OFFICIAL REPORT, 26th July, 1951; Vol. 491, c. 662.]Those words were spoken by the right hon. Member for Leeds, South from this Box on 26th July, 1951. They have, it seems to me, great relevance to the issue before us. They admit that there was no question of obtaining stability, and there is therefore no issue of principle between us at all. The only issue of principle 156 would be, surely, whether we maintain the present costs regardless of subsidy payments or whether we fix a lower figure that would be the only issue of principle. Once we get away from that, it is purely a question of degree where we fix the figure. What is perhaps significant is that in the words I have quoted from the right hon. Member for Leeds, South, he was indicating quite clearly that the competing claims for the money spent on food subsidies of certain social payments ought not to be disregarded and, in particular, that two of the objectives in connection with which that money might well be spent are family allowances and pensions. It will not have escaped you, Sir Charles, that it is precisely in those directions that my right hon. Friend has made very substantial advances.
It therefore surely becomes clear that all this atmosphere of the sacrosanctity of the figure of £410 million really does not stand up to analysis—that it is a matter of political and economical judgment from time to time to decide whether the money available is to be spent on maintaining the food subsidies at a particular level, or whether, in the circumstances of that time, that money can better be used to relieve those most hardly hit and at the same time to provide, through reliefs in Income Tax, a stimulus to greater effort and greater endeavour by those on whose efforts our national recovery depends. Then, I think, we have really narrowed our differences down to a matter that must vary from year to year, to a position in which it may well be that in one year one figure is the right one and in another year another one.
And there really the Government stand. We have thought, looking over the field as a whole, and in particular in view of the situation, of which the right hon. Member for Rochester and Chatham reminded us, which we inherited from the late Administration, that with the compelling need in these circumstances to provide the stimulus that Income Tax concessions can give to greater effort, it was right in the circumstances to make this adjustment in the food subsidies. Hon. Members, in calculating their effects, will, I hope, neither underrate nor exaggerate their consequences. I am sure that the Committee would be right to bear in mind that what people spend on food is not completely separate from—a unique part of—their family budget: it is part of that 157 expenditure—up to 40 per cent, of that expenditure; and the other 60 per cent. of it goes in directions in which, as I have said to the Committee, there are reasonable prospects, if restraint is shown by all concerned, of a steady, and, perhaps, falling, price level.
It is in those circumstances that the decision was taken. I would respectfully say this to the Committee, that the decision was not taken lightly. It was taken with
§ a full view of the grim national necessities, which this Government did not create but which this Government have to tackle. It is part and parcel of a policy which, as the months pass, will, I suggest to the Committee, show increasing success.
§ Question put, "That Item Class IX, Vote 7, Ministry of Food, be reduced by £5."
§ The Committee divided Ayes, 274; Noes, 301.161
|Division No. 186.]||AYES||[10.0 p.m.|
|Acland, Sir Richard||Dugdale, Rt. Hon. John (W. Bromwich)||Jones, Frederick Elwyn (West Ham, S.)|
|Adams, Richard||Ede, Rt. Hon. J. C.||Jones, Jack (Rotherham)|
|Albu, A. H.||Edelman, M.||Jones, T. W. (Merioneth)|
|Allen, Arthur (Bosworth)||Edwards, Rt. Hon. Ness (Caerphilly)||Keenan, W.|
|Allen, Scholefield (Crewe)||Edwards, W. J. (Stepney)||Kenyon, C.|
|Anderson, Alexander (Motherwell)||Evans, Albert (Islington, S. W.)||Key, Rt. Hon. C. W|
|Anderson, Frank (Whitehaven)||Evans, Edward (Lowestoft)||King, Dr. H. M.|
|Attlee, Rt. Hon. C. R.||Evans, Stanley (Wednesbury)||Kinley, J.|
|Awbery, S. S,||Ewart, R.||Lee, Frederick (Newton)|
|Ayles, W. H.||Fernyhough, E.||Lee, Miss Jennie (Cannock)|
|Bacon, Miss Alice||Field, W. J.||Lever, Harold (Cheetham)|
|Baird, J.||Fienburgh, W.||Lever, Leslie (Ardwick)|
|Balfour, A.||Finch, H. J||Lewis, Arthur|
|Barnes, Rt. Hon A. J.||Fletcher, Eric (Islington, E.)||Lindgren, G. S.|
|Bartley, P.||Follick, M.||Lipton, Lt.-Col. M.|
|Bellenger, Rt. Hon. F. J.||Foot, M. M.||Logan, D. G.|
|Bence, C. R.||Forman, J. C.||Longden, Fred (Small Heath)|
|Benn, Wedgwood||Fraser, Thomas (Hamilton)||MacColl, J. E.|
|Benson, G.||Freeman, John (Watford)||McGhee, H. G.|
|Beswick, F.||Freeman, Peter (Newport)||McGovern, J.|
|Bevan, Rt. Hon. A. (Ebbw Vale)||Gaitskell, Rt. Hon. H. T. N.||McInnes, J.|
|Bing, G. H. C.||Gibson, C. W.||McKay, John (Wallsend)|
|Blackburn, F.||Glanville, James||McLeavy, F.|
|Blenkinsop, A.||Gooch, E. G.||MacMillan, M. K. (Western Isles)|
|Blyton, W. R.||Gordon Walker, Rt. Hon. P. C.||McNeil, Rt. Hon. H.|
|Boardman, H.||Greenwood, Anthony (Rossendale)||MacPherson, Malcolm (Stirling)|
|Bottomley, Rt, Hon. A. G.||Greenwood, Rt. Hn. Arthur (Wakefield)||Mainwaring, W. H.|
|Braddock, Mrs. Elizabeth||Grenfell, Rt. Hon. D. R.||Mallalieu, J. P. W. (Huddersfield, E.)|
|Brookway, A. F.||Grey, C. F.||Mann, Mrs. Jean|
|Brook, Dryden (Halifax)||Griffiths, David (Rother Valley)||Manuel, A. C.|
|Broughton, Dr. A. D. D.||Griffiths, Rt. Hon. James (Llanelly)||Marquand, Rt. Hon. H. A.|
|Brown, Rt. Hon. George (Belper)||Griffiths, William (Exchange)||Mayhew, C. P.|
|Brown, Thomas (Ince)||Hale, Leslie (Oldham, W.)||Mellish, R. J.|
|Burke, W. A.||Hall, Rt. Hon. Glenvil (Colne Valley)||Messer, F.|
|Burton, Miss F. E||Hall, John (Gateshead, W.)||Mikardo, Ian|
|Butler, Herbert (Hackney, S.)||Hamilton, W. W.||Mitchison, G. R|
|Callaghan, L. J.||Hannan, W.||Monslow, W.|
|Carmichael, J.||Hargreaves, A.||Moody, A. S.|
|Castle, Mrs. B. A.||Hastings, S.||Morgan, Dr. H. B. W|
|Champion, A. J.||Hayman, F. H.||Morley, R.|
|Chapman, W. D.||Healay, Denis (Leeds, S.E.)||Morris, Percy (Swansea, W.)|
|Chetwynd, G. R.||Henderson, Rt. Hon. A. (Rowley Regis)||Morrison, Rt. Hon. H. (Lewisham, S.)|
|Clunie, J.||Herbison, Miss M.||Mort, D. L.|
|Cocks, F. S.||Hewitson, Capt. M||Moyle, A.|
|Coldrick, W.||Hobson, C. R||Murray, J. D.|
|Collick, P. H.||Holman, P.||Nally, W.|
|Corbet, Mrs. Freda||Houghton, Douglas||Neal, Harold (Bolsover)|
|Cove, W. G.||Hoy, J. H.||Noel-Baker, Rt. Hon. P. J.|
|Craddock, George (Bradford, S.)||Hubbard, T. F.||Oldfield, W. H.|
|Crosland, C. A. R.||Hudson, James (Ealing, N.)||Oliver, G. H.|
|Crossman, R. H. S.||Hughes, Cledwyn (Anglesey)||Orbach, M.|
|Cullen, Mrs. A.||Hughes, Entrys (S. Ayrshire)||Oswald, T.|
|Daines, P.||Hughes, Hector (Aberdeen, N.)||Padley, W. E.|
|Dalton, Rt. Hon. H.||Hynd, H. (Accrington)||Paget, R. T.|
|Darling, George (Hillsborough)||Hynd, J. B. (Attercliffe)||Paling, Rt. Hon. W. (Dearne Valley)|
|Davies, A. Edward (Stoke, N.)||Irvine, A. J. (Edge Hill)||Paling, Will T. (Dewsbury)|
|Davies, Ernest (Enfield, E.)||Irving, W. J. (Wood Green)||Pannell, Charles|
|Davies, Harold (Leek)||Isaacs, Rt. Hon. G. A.||Pargiter, G. A.|
|Davies, Stephen (Merthyr)||Janner, B.||Parker, J.|
|de Freitas, Geoffrey||Jay, Rt. Hon. D. P. T.||Paton, J.|
|Deer, G.||Jeger, George (Goole)||Peart, T. F.|
|Delargy, H. J.||Jeger, Dr. Santo (St. Pancras, S.)||Plummer, Sir Leslie|
|Dodds, N. N.||Jenkins, R. H. (Stetchford)||Poole, C. C.|
|Donnelly, D. L.||Johnson, James (Rugby)||Popplewell, E.|
|Driberg, T. E. N.||Jones, David (Hartlepool)||Price, Joseph T. (Westhoughton)|
|Price, Philips (Gloucestershire, W.)||Soskice, Rt. Hon. Sir Frank||Webb, Rt. Hon. M. (Bradford, C)|
|Proctor, W. T||Sparks, J. A.||Weitzman, D.|
|Pursey, Cmdr. H.||Steele, T.||Wells, Percy (Faversham)|
|Rankin, John||Stewart, Michael (Fulham, E.)||Wells, William (Walsall)|
|Reeves, J.||Stokes, Rt. Hon. R. R.||West, D. G.|
|Reid, Thomas (Swindon)||Strachey, Rt. Hon. J.||White, Mrs. Eirene (E. Flint)|
|Reid, William (Camlachie)||Strauss, Rt. Hon. George (Vauxhall)||White, Henry (Derbyshire, N. E.)|
|Rhodes, H.||Stross, Dr Barnett||Whiteley, Rt. Hon. W|
|Robens, Rt. Hon. A.||Swingler, S. T.||Wigg, George|
|Roberts, Albert (Normanton)||Sylvester, G. O.||Wilcock, Group Capt C. A. B.|
|Roberts, Goronwy (Caernarvonshire)||Taylor, Bernard (Mansfield)||Wilkins, W. A.|
|Robinson, Kenneth (St. Pancras, N.)||Taylor, John (West Lothian)||Willey, Frederick (Sunderland, N.)|
|Rogers, George (Kensington, N.)||Taylor, Rt. Hon. Robert (Morpeth)||Willey, Octavius (Cleveland)|
|Ross, William||Thomas, David (Aberdare)||Williams, David (Neath)|
|Royle, C.||Thomas, George (Cardiff)||Williams, Ronald (Wigan)|
|Schofield, S. (Barnsley)||Thomas, Iorwerth (Rhondda, W.)||Williams, Rt. Hon. Thomas (Don V'll'y)|
|Shawcross, Rt. Hon. Sir Hartley||Thomas, Ivor Owen (Wrekin)||Williams, W. R. (Droylsden)|
|Shinwell, Rt. Hon E.||Thorneycroft, Harry (Clayton)||Williams, W. T (Hammersmith, S.)|
|Short, E. W.||Thurtle, Ernest||Wilson, Rt. Hon. Harold (Huyton)|
|Silverman, Julius (Erdington)||Timmons, J.||Winterbottom, Ian (Nottingham, C.)|
|Silverman, Sydney (Nelson)||Temney, F.||Winterbottom, Richard (Brightside)|
|Simmons, C. J. (Brierley Hill)||Turner-Samuels, M.||Woodburn, Rt. Hon. A|
|Slater, J.||Ungoed-Thomas, Sir Lynn||Wyatt, W. L.|
|Smith, Ellis (Stoke, S.)||Usborne, H. C.||Yates, V. F|
|Smith, Norman (Nottingham, S.)||Viant, S. P.||Younger, Rt Hon K|
|Snow, J. W.||Wallace, H. W.|
|Sorensen, R. W.||Watkins, T. E.||TELLERS FOR THE AYES:|
|Mr. Pearson and Mr. Holmes.|
|Aitken, W. T.||Cole, Norman||Harden, J. R. E.|
|Allan, R. A. (Paddington, S.)||Conant, Maj. R. J. E.||Hare, Hon. J. H|
|Alport, C. J. M.||Cooper, Sqn. Ldr. Albert||Harris, Frederic (Croydon, N.)|
|Amery, Julian (Preston, N.)||Cooper-Key, E. M.||Harris, Reader (Heston)|
|Amory, Heathcoat (Tiverton)||Craddock, Beresford (Spelthorne)||Harrison, Col. J. H. (Eye)|
|Anstruther-Gray, Major W. J.||Cranborne, Viscount||Harvey, Air Cdre. A. V. (Macclesfield)|
|Arbuthnot, John||Crookshank, Capt. Rt. Hon. H. F. C.||Harvey, Ian (Harrow, E.)|
|Ashton, H. (Chelmsford)||Crosthwaite-Eyre, Col. O. E.||Harvie-Watt, Sir George|
|Assheton, Rt. Hon. R. (Blackburn, W.)||Crouch, R. F.||Hay, John|
|Astor, Hon. J. J. (Plymouth, Sutton)||Crowder, Sir John (Finchley)||Head, Rt. Hon. A. H.|
|Astor, Hon. W. W. (Bucks, Wycombe)||Crowder, Petre (Ruislip—Northwood)||Heald, Sir Lionel|
|Baker, P. A. D.||Cuthbert, W. N.||Henderson, John (Cathcart)|
|Baldock, Lt.-Cmdr. J. M.||Darling, Sir William (Edinburgh, S)||Hill, Dr. Charles (Luton)|
|Baldwin, A. E.||Davidson, Viscountess||Hill, Mrs. E. (Wythenshawe)|
|Banks, Col. C.||Davies, Rt. Hn. Clement (Montgomery)||Hinchingbrooke, Viscount|
|Barber, A. P. L.||De la Bere, Sir Rupert||Hirst, Geoffrey|
|Barlow, Sir John||Deedes, W. F.||Holland-Martin, C. J.|
|Baxter, A. B.||Digby, S. Wingfield||Hollis, M. C.|
|Beach, Maj. Hicks||Dodds-Parker, A. D.||Holmes, Sir Stanley (Harwich)|
|Beamish, Maj. Tufton||Donaldson, Cmdr. C. E. McA||Hope, Lord John|
|Bell, Philip (Bolton, E.)||Donner, P. W.||Hopkinson, Henry|
|Bell, Ronald (Bucks, S.)||Doughty, C. J. A||Hornsby-Smith, Miss M P|
|Bennett, F. M. (Reading, N.)||Drayson, G. B.||Horobin, I. M.|
|Bennett, Dr. Reginald (Gosport)||Drewe, C||Horsbrugh, Rt. Hon. Florence|
|Bennett, William (Woodside)||Dugdale, Maj. Rt.Hn. Sir T. (Richmond)||Howard, Gerald (Cambridgeshire)|
|Bevins, J. R. (Toxteth)||Duncan, Capt. J. A. L.||Howard, Greville (St. Ives)|
|Birch, Nigel||Duthie, W. S.||Hudson, Sir Austin (Lewisham, N.)|
|Bishop, F. P.||Eccles, Rt. Hon. D. M.||Hudson, W. R. A. (Hull, N.)|
|Black, C. W.||Elli[...]t, Rt. Hon. W. E.||Hurd, A. R.|
|Boothby, R. J. G.||Fell, A.||Hutchinson, Sir Geoffrey (Ilford, N.)|
|Bossom, A. C.||Finlay, Graeme||Hutchison, James (Scotstoun)|
|Bowen, E. R.||Fisher, Nigel||Hyde, Lt.-Col. H. M.|
|Boyd-Carpenter, J. A.||Fleetwood-Hesketh, R. F.||Hylton-Foster, H. B. H.|
|Boyle, Sir Edward||Fletcher-Cooke, C||Jenkins, Robert (Dulwich)|
|Braine, B. R.||Fort, R.||Jennings, R.|
|Braithwaite, Sir Albert (Harrow, W.)||Foster, John||Johnson, Eric (Blackley)|
|Braithwaite, Lt.-Cdr. G. (Bristol, N. W.)||Fraser, Hon. Hugh (Stone)||Johnson, Howard (Kemptown)|
|Bromley-Davenport, Lt.-Col. W. H.||Fraser, Sir Ian (Morecambe & Lonsdale)||Jones, A. (Hall Green)|
|Brooke, Henry (Hampstead)||Fyfe, Rt. Hon. Sir David Maxwell||Joynson-Hicks, Hon. L. W.|
|Brooman-White, R. C.||Gage, C. H.||Kaberry, D.|
|Browne, Jack (Govan)||Galbraith, Cmdr. T. D. (Pollok)||Keeling, Sir Edward|
|Buchan-Hepburn, Rt. Hon. P. G. T.||Galbraith, T. G. D. (Hillhead)||Kerr, H. W. (Cambridge)|
|Bullard, D. G.||Gammans, L. D.||Lambton, Viscount|
|Bullock, Capt. M.||Garner-Evans, E. H.||Lancaster, Col. C. G.|
|Bullus, Wing Commander E. E.||George, Rt. Hon. Maj. G Lloyd||Langford-Holt, J. A.|
|Burden, F. F. A.||Godber, J. B.||Law, Rt. Hon. R. K.|
|Butler, Rt. Hon. R. A. (Saffron Walden)||Gomme-Duncan, Col. A.||Leather, E. H. C.|
|Carr, Robert (Mitcham)||Gough, C. F. H.||Legge-Bourge, Maj. E. A. H|
|Carson, Hon. E.||Gower, H. R.||Legh, P. R. (Petersfield)|
|Cary, Sir Robert||Graham, Sir Fergus||Lennox-Boyd, Rt. Hon. A. T.|
|Channon, H.||Gridley, Sir Arnold||Lindsay, Martin|
|Churchill, Rt. Hon. W. S.||Grimond, J.||Linstead, H. N.|
|Clarke, Col. Ralph (East Grinstead)||Grimston, Hon. John (St. Albans)||Lloyd, Rt. Hon G. (King's Norton)|
|Clarke, Brig. Terence (Portsmouth, W.)||Grimston, Sir Robert (Westbury)||Lloyd, Maj. Guy (Renfrew, E.)|
|Lloyd, Rt. Hon. Selwyn (Wirral)||O'Neill, Rt. Hon. Sir H. (Antrim, N.)||Stanley, Capt. Hon. Richard|
|Lockwood, Lt.-Col. J. C.||Ormsby-Gore, Hon. W. D.||Stevens, G. P.|
|Longden, Gilbert (Herts, S. W.)||Orr, Capt. L. P. S.||Steward, W. A. (Woolwich, W.)|
|Low, A. R. W.||Orr-Ewing, Charles Ian (Hendon, N.)||Stewart, Henderson (Fife, E.)|
|Lucas, Sir Jocelyn (Portsmouth, S.)||Orr-Ewing, Ian L. (Weston-super-Mare)||Stoddart-Scott, Col. M.|
|Lucas, P. B. (Brentford)||Osborne, C.||Storey, S.|
|Lucas-Tooth, Sir Hugh||Partridge, E.||Strauss, Henry (Norwich, S.)|
|Lyttelton, Rt. Hon. O||Peake, Rt. Hon. O.||Stuart, Rt. Hon. James (Moray)|
|McAdden, S. J.||Perkins, W. R. D.||Studholme, H. G.|
|McCorquodale, Rt. Hon. M. S.||Peyton, J. W. W.||Summers, G. S.|
|Macdonald, Sir Peter (I. of Wight)||Pickthorn, K. W. M||Sutcliffe, H.|
|Mackeson, Brig. H. R.||Pilkington, Capt. R. A.||Taylor, Charles (Eastbourne)|
|McKibbin, A. J.||Pitman, I. J.||Taylor, William (Bradford, N.)|
|McKie, J. H. (Galloway)||Powell, J. Enoch||Teeling, W.|
|Maclay, Hon. John||Price, Henry (Lewisham, W.)||Thomas, Rt. Hon. J. P. L. (Hereford)|
|Maclean, Fitzroy||Prior-Palmer, Brig. O. L.||Thomas, P. J. M. (Conway)|
|MacLeod, Rt. Hon. Iain (Enfield, W.)||Profumo, J. D.||Thompson, Kenneth (Walton)|
|MacLeod, John (Ross and Cromarty)||Raikes, H. V.||Thompson, Lt.-Cdr. R. (Croydon, W.)|
|Macmillan, Rt. Hon. Harold (Bromley)||Redmayne, M.||Thorneycroft, Rt. Hn. Peter (Monmouth)|
|Macpherson, Maj. Niall (Dumfries)||Remnant, Hon. P.||Thornton-Kemsley, Col C. N.|
|Maitland, Comdr. J. F. W. (Horncastle)||Renton, D. L. M.||Tilney, John|
|Maitland, Patrick (Lanark)||Roberts, Peter (Heeley)||Touche, Sir Gordon|
|Manningham Buller, Sir R. E.||Robertson, Sir David||Turner, H. F. L.|
|Markham, Major S. F.||Robinson, Roland (Blackpool, S.)||Turton, R. H.|
|Marlowe, A. A. H.||Robson-Brown, W.||Tweedsmuir, Lady|
|Marples, A. E.||Rodgers, John (Sevenoaks)||Vane, W. M. F.|
|Marshall, Douglas (Bodmin)||Roper, Sir Harold||Vaughan-Morgan, J. K.|
|Marshall, Sir Sidney (Sutton)||Ropner, Col. Sir Leonard||Vosper, D. F.|
|Maude, Angus||Russell, R. S.||Wade, D. W.|
|Maudling, R||Ryder, Capt. R. E. D.||Wakefield, Edward (Derbyshire, W.)|
|Medlicott, Brig. F||Salter, Rt. Hon. Sir Arthur||Wakefield, Sir Wavell (Marylebone)|
|Mellor, Sir John||Sandys, Rt. Hon. D.||Walker-Smith, D. C.|
|Molson, A. H. E.||Savory, Prof. Sir Douglas||Ward, Hon. George (Worcester)|
|Monckton, Rt. Hon. Sir Walter||Schofield, Lt.-Col. W. (Rochdale)||Ward, Miss I. (Tynemouth)|
|Moore, Lt.-Col. Sir Thomas||Scott, R. Donald||Waterhouse, Capt. Rt. Hon. C.|
|Morrison, John (Salisbury)||Scott-Miller, Cmdr. R.||Webbe, Sir H. (London & Westminster)|
|Mott-Radclyffe, C. E.||Shepherd, William||Wellwood, W.|
|Nabarro, G. D. N.||Simon, J. E. S. (Middlesbrough, W.)||White, Baker (Canterbury)|
|Nicholls, Harmar||Smiles, Lt.-Col. Sir Walter||Williams, Rt. Hon. Charles (Torquay)|
|Nicholson, Godfrey (Farnham)||Smithers, Peter (Winchester)||Williams, Gerald (Tonbridge)|
|Nicolson, Nigel (Bournemouth, E.)||Smithers, Sir Waldron (Orpington)||Williams, Sir Herbert (Croydon, E.)|
|Nield, Basil (Chester)||Smyth, Brig. J. G. (Norwood)||Williams, R. Dudley (Exeter)|
|Noble, Comdr. A. H. P.||Snadden, W. MoN.||Wills, G.|
|Nugent, G. R. H.||Soames, Capt. C||Wilson, Geoffrey (Truro)|
|Nutting, Anthony||Spearman, A. C. M.||Wood, Hon. R.|
|Oakshott, H. D.||Speir, R. M.|
|Odey, G. W.||Spens, Sir Patrick (Kensington, S.)||TELLERS FOR THE NOES:|
|Mr. Butcher and Mr. Heath.|
Question put, and agreed to.
§ Original Question again proposed.
§ It being after Ten o'Clock, and objection being taken to further Proceeding, The CHAIRMAN left the Chair to report Progress, and ask leave to sit again.
§ Committee report Progress; to sit again Tomorrow.