Incomes Policy (Hansard, 17 March 1964)

§ 11. Mr. Holt
asked the Chancellor of the Exchequer what steps he now proposes to take to bring profits within the scope of incomes policy, in view of the fact that Her Majesty's Government's measures against monopolies and mergers are not to take effect within the life of this Parliament.

§ 27. Mr. A. Lewis
asked the Chancellor of the Exchequer, in view of the fact that the Federation of British Industries have refused to take action to curb profits in order to further the introduction of a national policy, what action Her Majesty's Government now propose to take regarding such a policy; and whether he will make a statement.

§ Mr. Boyd-Carpenter
The Government have repeatedly made it clear that its incomes policy relates to all forms of income. I understand that the Federation of British Industries has considered three possible schemes for discipline over profits or prices, but has felt unable to recommend any one of them. The Government recognise that there are very considerable difficulties both on the employers' side and on the trade union side, in working out an agreed incomes policy. I think that it is important that these problems should continue to be discussed on the National Economic Development Council. Meanwhile, as hon. Members know, the Government are pledged to restrain any undue growth in aggregate profits which may follow restraint in earned incomes, and the National Incomes Commission is required to report from time to time on the need if any for such action to be taken.

§ Mr. Holt
Does the right hon. Gentleman now expect that as a result of recent Government announcements about resale price maintenance, monopolies and the like the N.E.D.C. will now feel that the Government have given a strong enough lead in this direction for employers and employees on that body to agree to an incomes policy?

§ Mr. Boyd-Carpenter
I am sure that in the N.E.D.C., and through the N.E.D.C., the outside world, there is an increasing appreciation of the crucial importance of a sensible incomes policy.

§ Mr. A. Lewis
The right hon. Gentleman replied that the Government have at all times referred to incomes and all forms of income. Can he tell us of even one occasion when the Prime Minister has referred to rents, interest and profits? Is it not the case that on every occasion the reference has been to wages? Will the right hon. Gentleman draw the Prime Minister's attention to the fact that the F.B.I. has refused to come in, whereas 1165 the trade unions have said that provided it is fair and equitable and covers all forms of income they are agreeable to work out some sort of scheme?

§ Mr. Boyd-Carpenter
I have often heard my right hon. Friend refer to the fact that our policy covers incomes generally. While, as I said in my main Answer, the F.B.I. has rejected the three schemes it has been studying, it is continuing its studies to see whether a further and better method can be evolved.

§ Mr. Hiley
From where does my right hon. Friend the Chancellor of the Exchequer expect to get all the money needed to finance all these schemes if profits decline?

§ Mr. Boyd-Carpenter
There is nothing in my Answer to suggest that profits are likely to or should decline. The words originally used in the National Incomes Commission White Paper referred to undue growth of profits resulting from wage restraint.

§ Mr. Houghton
Has the Chancellor of the Exchequer given up hope of making any further progress on this matter in the immediate future? If so, would it not be better for the Government to go to the country so that we can get some stability in the political situation and make some immediate further progress on this matter?

§ Mr. Boyd-Carpenter
My right hon. Friend has certainly not given up hope of further progress in the matter, in which good sense in all quarters points only in one direction.

§ Sir C. Osborne
As the F.B.I. cooperated with a Socialist Chancellor, Sir Stafford Cripps, why will it not now co-operate with my right hon. Friend?

§ Mr. Boyd-Carpenter
It is quite unfair to the F.B.I. to say that it will not co-operate. It has studied a number of schemes which, on merits, it has found to be defective, but, as I said in an earlier reply, it is continuing its studies and I know has every intention to be helpful.