HC Deb 25 October 1960 vol 627 cc2128-30
11. Mr. Holt

asked the Chancellor of the Exchequer what steps he is taking to ensure that the cost of living does not go up as a result of higher prices for fuel and transport.

12. Mr. Collick

asked the Chancellor of the Exchequer what steps he is now taking to reduce the cost of living and bring down prices.

Mr. Selwyn Lloyd

Movements in the cost of living are caused by many factors, among which, of course, are the costs of fuel and transport.

The general objective of the Government's economic policy is to keep prices stable by maintaining a balance between demand and resources. But, even when such a balance is secured, stability of prices will still largely depend on the efforts of all concerned to ensure that the rate of increase in wages and salaries does not exceed the rate of increase in national productivity.

Mr. Holt

May I take it that the Answer which the Chancellor of the Exchequer has just given is, as far as my Question is concerned, precisely nil?

Mr. Lloyd

The answer to the hon. Gentleman's Question is that we are going to keep stability of prices. We have to equate demand and resources.

Mr. Collick

Is the right hon. and learned Gentleman aware that his predecessor repeatedly urged that there should be a reduction in prices, but there has, in fact, been no such noticeable reduction? Is the Chancellor aware that the answer which he gave to the previous question completely abandoned what I thought was the Government's policy, that of bringing about a reduction in prices?

Mr. Lloyd

We have certainly not abandoned that, and I shall be very happy to see it come about. What we have done over the last two years has been to stabilise prices. I say frankly to the hon. Gentleman that what concerns me at the moment is whether we shall be able to maintain that stability. I think that that is the problem which confronts all of us in all quarters of the House.

Mr. P. Williams

Can my right hon. and learned Friend say how an increase in the price of coal will tend to sell more of it?

Mr. Lloyd

That is a rather different issue.

Mr. Hamilton

Can the right hon. and learned Gentleman say why he continu- ally refers to wages and salaries without reference to profits and capital gains and so on? Can he further tell us what effect the recently announced increase by the Road Hauliers Association will have on fares and transport costs generally?

Mr. Lloyd

It certainly will not have a good effect. No increase in price will have a good effect. The real answer to the problem is to increase the total national product and keep productivity ahead of the increase. I would certainly include in any request for restraint both profits and prices.

Mr. S. Silverman

Is it the Chancellor's point that if a man pledges himself to go forward he fulfils his pledge by proving that he is standing still?

Mr. Lloyd

It is very much better to stand still than to go backwards.