HC Deb 28 June 1965 vol 715 cc29-33
The First Secretary of State and Secretary of State for Economic Affairs (Mr. George Brown)

With your permission, Mr. Speaker, and that of the House, I would like to make a statement.

The House will wish to know that the first Report to be issued by the National Board for Prices and Incomes is being published this afternoon and copies are available in the Vote Office. This is an interim Report on road haulage rates, a case which I referred to the Board on 6th May. The principal recommendation of the Report is that the practice of general rate recommendations by the Road Haulage Association is not in the interests of the industry or its customers and should be abandoned; and that in consequence the latest recommendation for a general 5 per cent. increase should be withdrawn, and in any case should not be accepted by the industry's customers.

The Report further recommends that it is for each haulier to judge, in the light of his own circumstances, the extent to which he can absorb increases in costs instead of passing them on to the customer. Other recommendations relate to the development of voluntary wage-negotiating machinery, to ways of achieving higher productivity and a number of other matters. I and my colleagues will be discussing the main recommendations with the Road Haulage Association tomorrow, and the other recommendations in the Report will be discussed with the Association and the trade unions by the responsible Government Departments.

This first Report by the Board is valuable and encouraging, not only for the substance of its recommendations, which are, in my judgment, fully in line with the agreed principles on which the prices and incomes policy is based, but also because it clearly illustrates two points: First, fiat this is not a negative policy designed merely to secure restraint but is a constructive policy concerned to foster productivity, economic growth and general prosperity.

Second, that even in a complicated issue of this sort, it is possible for a detailed investigation to be carried out in a relatively short time. Both by the quality of its first Report and by the speed with which it has been prepared, I think that the National Board for Prices and Incomes has launched itself into the public life of this country in a way which augurs well for the future.

Mr. Heath

The Secretary of State will be aware that we shall want to study the Report with care; in particular, the detailed matters which he has not described, obviously because there is not time in a statement of this kind. He has not said whether the Government endorse the Report or not, unless he means by his statement that the Report is … fully in line with the agreed principles on which the prices and incomes policy is based … —these principles have never yet been made very clear—that the Government do endorse it.

If the Government do endorse the Report, do they also endorse the passage stating that the industry's customers should not accept the 5 per cent. increase? If the Board recommends that it is up to the haulier to decide what his increases should be, surely it is also for the customer to decide which increases he is prepared to accept and no general rule can be laid down.

Does the right hon. Gentleman realise that, whether recommendations are made or not, costs still increase so long as the Government force them up by taxation and inflation, with consequences for the road haulage industry? As the Government are apparently prepared to agree with the recommendations, is this not in complete contradiction of their attitude when we were dealing with the Resale Prices Act?

Finally, does the right hon. Gentleman recognise that road haulage is a competitive industry if only because hauliers can carry their own goods under C licences? If the Government's policy is now to support competition, why has the Geddes Report been shelved and why did the Minister of Transport state less than a fortnight ago that his policy is not one of competition in the industry?

Mr. Brown

No doubt the right hon. Member for Bexley (Mr. Heath) will be asking my right hon. Friend the Minister of Transport about that.

I understand that one of the difficulties in this industry—and it is one of the things which obviously has to be taken into account—is that the practice of trying to enforce a general increase right across the board reduces and does not increase competition.

As to whether the Government accept the Report, when I said that in my judgment it was fully in line with the agreed principles on which the policy is based, that is exactly what I meant, because not all of the recommendations are for the Government to put into effect. They also affect many other people. I have asked the Association, and it has agreed, to come to see me, and I thought that it would be more courteous to await that meeting before announcing our own views in too much detail.

As to the customer's view, the Report has clearly shown that if there is an attempt at this time to enforce a general increase which is not related to the curcumstances of any individual haulier, then the customer should use his power by making his own selection of haulier. If we are to bring an end to these inflationary tendencies throughout industry, one of the things which has to happen is that the power of the customer to shop around and to decide where to buy must be invoked.

On the Government's policy, the right hon. Gentleman knows exactly why the increases in taxes have to be made. One of the reasons why we are pressing ahead so hard with the prices and incomes policy is to get rid of the inflationary spiral which was such a distinguishing feature of the tenure of office of right hon. Gentlemen opposite.

Mr. Webster

Has the right hon. Gentleman asked the Transport and General Workers' Union whether it will refrain from asking for an overall increase in wages?

Mr. Brown

It is not part of the prices and incomes policy to stop people from asking for overall increases in wages. As I have repeatedly pointed out to the House—and I am surprised that the hon. Gentleman is falling into the bad habits of the Official Opposition—it is not part of the policy to enforce restraint of wages. What we want is any overall increase in all personal incomes to be in line with the overall rise in production and productivity in the nation.

Mr. Lubbock

May I congratulate the right hon. Gentleman on his defence of free enterprise and competition in the road haulage industry? Can he say more about the ways of increasing production and achieving higher productivity which he mentioned in the statement? Secondly, can he give the House an assurance that other Reports by the National Board for Prices and Incomes will be produced with equal expedition, particularly that concerning electricity prices?

Mr. Brown

I have said repeatedly that there is a place for both public and private enterprise and that both must be enterprising and allowed to earn their due reward, but that neither must try to impose on the customer charges which are not justified.

On the subject of the recommendations for higher productivity, it would probably be better for the Report to be read, when I shall be readily available to the House for further questions after the House has had a chance to read the recommendations and I have had a chance to discuss them with the bodies concerned. I am sure that the Board will act with equal expedition on all its other Reports. It has a full volume of work at the moment and is working very hard on it. I expect to have the next Reports within a few weeks from now.

Mr. Shepherd

As collective resale price maintenance in respect of goods is already virtually illegal under the 1956 legislation, will the right hon. Gentleman consider extending the provisions of that legislation to services now that services and goods are regarded in the same light?

Mr. Brown

It does not look as though that is necessary, although I will think about it. It is obvious that we are able to deal with that matter with this machinery just as well.

Sir T. Beamish

In view of the right hon. Gentleman's touching faith in competition and more competition and consumer choice, am I completely correct in thinking that the nationalisation of long-distance road haulage has been dropped from the Socialist programme?

Mr. Brown

The hon. and gallant Gentleman may be reading more into my statement than I said. What I said was that where industry purported to operate as a free enterprise industry it had better be freely enterprising.