§ 14. Mr. W. Hamilton
asked the Chancellor of the Exchequer if he will make a further statement on the results of his recent appeals for lower prices.
§ 37. Mr. Lipton
asked the Chancellor of the Exchequer to what extent his appeal for lower prices has been successful.
I would refer the right hon. and hon. Members to the answer I gave to the hon. Members for Morpeth (Mr. Owen) and Birkenhead (Mr. Collick) on 26th January.
I am never satisfied. If I had time I could give concrete examples. What I feel fairly satisfied about is that my statements have had some effect in maintaining the stability of the price level which we are still enjoying.
§ Mr. Hamilton
Will the Chancellor not be perfectly frank with the House and tell us what we have all read, that employers have given him dusty answers in his appeal for price reductions? Is he not aware that, according to the cost of living index, far from prices coming down, they have gone up in recent months? Will he give some indication as to when he thinks the time will be more favourable than the present for price reductions to be made?
I certainly do not consider that I have had dusty answers from the industrial organisations which I have approached. My object has been to encourage the maintenance of the present stability. I believe that my statements have made increases less common than they otherwise would have been, and we are still enjoying stability. I did not ask for a price freeze any more than I have asked for a wage freeze. Nor did I ask for a reduction in prices right across the board. What I did ask for was that those who were succeeding in getting benefits from increased productivity should share those benefits with the consumer.
§ Mr. Lipton
Will the Chancellor of the Exchequer explain in the simplest possible terms how his campaign for lower prices is assisted by raising the Bank Rate? Does not that set a bad example to other people who want to raise things too?
I think one of the reasons, among others, for raising the Bank Rate was to maintain our present stability in prices.
§ Lieut.-Colonel Bromley-Davenport
What is the use of appealing to industry to lower its prices when fuel and power, on which the ultimate cost of everything depends, is supplied by nationalised industries which keep raising their charges? Should not the nationalised industries set an example in this matter by increasing production and lowering their prices?
I must remind my hon. and gallant Friend that what I was 774 asking for was that the benefits arising from increases in productivity should be shared. The first thing that has to be achieved is an increase in productivity.
§ Mr. Nabarro
Would not my right hon. Friend recognise that he personally could make the most massive contribution to the lowering of prices by joining the "Nabarro Lobby" on Purchase Tax?
When the Chancellor of the Exchequer has explained to his hon. and gallant Friend the Member for Knutsford (Lieut.-Colonel Bromley-Davenport) that the prices of the nationalised industries have risen a good deal less than those of private industry and has dealt suitably with his hon. Friend the Member for Kidderminster (Mr. Nabarro), will he answer this question? In view of the very big increase in profits in the past few months and the obvious expectations of still further increases in profits as shown by the present level of equity prices on the Stock Exchange, does not the Chancellor feel that part of these increased profits ought to be passed on to the consumer in the shape of lower prices?
That is exactly what I said: I said that the benefits of increased productivity should be shared with the consumer.
In a free economy, the main influence in any process of lowering prices must be the forces of competition. The Government can contribute by regulating the level of demand so as to avoid overloading the economy, and this is my steady objective. Success, however, will depend, on the co-operation of other sections of the community. For this reason, I have urged managements to make full use of opportunities to reduce their prices and have pointed out the dangers of an unrestrained pursuit of higher wages and salaries and profits. We have succeeded in preserving price stability for nearly two years now, and I propose to continue the policies which have been followed in that time.
§ Mr. Dodds
As now after 8½ years of this Government prices are at an all-time high record, will the Chancellor of the Exchequer say whether it is his ambition 775 to stabilise them at that all-time record, or will he say when the promises of reduced prices are to take effect? Cannot he do any better than he has done?
I am always hoping to do still better, but I think we must not underrate the value of the stability in prices which has been a marked feature of the economy for almost two years.