§ The Objectives
§ The Government's economic objective is to achieve and maintain a rapid increase in output and real incomes combined with full employment. Their social objective is to ensure that the benefits of faster growth are distributed in a way that satisfies the claims of social need and justice. In this way general confidence will be created in the purpose of the national plan and individuals will be willing to make their utmost contribution towards its implementation.
§ 2. Essential conditions for the achievement of these objectives are a strong currency and a healthy balance of payments.
§ The Economic Situation
§ 3. The economic situation, while potentially strong, is at present extremely unsatisfactory. 386 Drastic temporary measures have been taken to meet a situation in which the balance of payments was in serious deficit, with exports falling behind imports. But these measures can provide only a breathing space.
§ 4. To achieve a more permanent solution, we must improve the balance of payments, encourage exports and sharpen our competitive ability. Our longer-term interests lie in reducing the barriers to international trade. We must take urgent and vigorous action to raise productivity throughout industry and commerce, to keep increases in total money incomes in line with increases in real national output and to maintain a stable general price level. Unless we do this we shall have a slower rate of growth and a lower level of employment.
§ 5. We—Government, management and unions—are resolved to take the following action in our respective spheres of responsibility.
§ The Government
§ 6. The Government will prepare and implement a general plan for economic development, in consultation with both sides of industry through the National Economic Development Council. This will provide for higher investment; for improving our industrial skills; for modernisation of industry; for balanced regional development; for higher exports; and for the largest possible sustained expansion of production and real incomes.
§ 7. Much greater emphasis will be given to increasing productivity. The Government will encourage and develop policies, designed to promote technological advance in industry, and to get rid of restrictive practices and prevent the abuse of monopoly power, and so improve efficiency, cut out waste, and reduce excessive prices. More vigorous policies will be pursued designed to facilitate mobility of labour and generally to make more effective use of scarce manpower resources, and to give workers a greater sense of security in the face of economic change. The Government also intend to introduce essential social improvements such as a system of earnings-related benefits, in addition to the improvements in national insurance benefits already announced.
§ 8. The Government will set up machinery to keep a continuous watch on the general movement of prices and of money incomes of all kinds and to carry out the other functions described in paragraph 10 below. They will also use their fiscal powers or other appropriate means to correct any excessive growth in aggregate profits as compared with the growth of total wages and salaries, after allowing for short-term fluctuations.
§ Management and Unions
§ 9. We, the representatives of the Trades Union Congress, the Federation of British Industries, the British Employers' Confederation, the National Association of British Manufacturers, and the Association of British Chambers of Commerce accept that major objectives of national policy must be:
- to ensure that British industry is dynamic and that its prices are competitive;
- to raise productivity and efficiency so that real national output can increase, and to keep increases in wages, salaries and other forms of incomes in line with this increase;
- to keep the general level of prices stable.
§ 10. We therefore undertake, on behalf of our members:
- to encourage and lead a sustained attack on the obstacles to efficiency, whether on the part of management or of workers, and to strive for the adoption of more rigorous standards of performance at all levels;
- to co-operate with the Government in endeavouring, in the face of practical problems, to give effective shape to the machinery that the Government intend to establish for the following purposes:
- (i) to keep under review the general movement of prices and of money incomes of all kinds;
| On behalf of the Trades UnionCongress | On behalf of H.M. Government | On behalf of the Association of British Chambers of Commerce |
| (Signed) RICHARD WILLS CHARLES HEY | ||
| On behalf of the British Employers' Confederation | ||
| (Signed) COLLISON | (Signed) GEORGE BROWN | (Signed) MAURICE LAING |
| GEORGE WOODCOCK | JAMES CALLAGHAN | GEORGE POLLOCK |
| DOUGLAS JAY | On behalf of the Federation of British | |
| RAY GUNTER | Industries | |
| (Signed) PETER RUNGE | ||
| NORMAN KIPPING | ||
| On behalf of the National Association of British Manufacturers | ||
| (Signed) LESLIE JENKINS HAROLD GRAY | ||
| 16th December, 1964. |