HC Deb 15 November 1956 vol 560 cc1115-6
20. Mr. G. Darling

asked the Chancellor of the Exchequer what estimate he has made of the effect which the general increase in shipping freight rates is likely to have on internal retail prices.

The Economic Secretary to the Treasury (Mr. Derek Walker-Smith)

It is not at present possible to make a close estimate of likely changes in freight costs over the months ahead. For the sake of illustration only, the direct effect of a 5 per cent. increase in freight costs might be a rise in the general level of retail prices of about one-tenth of 1 per cent.

Mr. Darling

That may be true as a sort of estimate at this stage, but will the hon. Member tell his right hon. Friend that the best way to remain on a plateau of stability is to exercise restraint in all directions and not merely ask the trade unions to do so? In what is supposed to be a free market, can we have an undertaking that the Government will step in to prevent any exploitation of the situation by way of rising prices that are quite unreasonable and unnecessary?

Mr. Walker-Smith

The House will not expect me to answer any hypothetical questions contained in the hon. Member's supplementary question. In regard to the first part of it, my right hon. Friend bears closely in mind everything suggested by the hon. Member, but he is of course well aware of the requirements of the economic situation.

Mr. D. Marshall

In view of the answer that has just been given, I wonder if the Minister could also answer this question. If a 5 per cent. rise in freight rates does in fact cause a rise of one-tenth of 1 per cent. on the retail price side, what will be the actual rise in invisible earnings?

Mr. Walker-Smith

Perhaps my hon. Friend will be good enough to put down that interesting question.