HC Deb 01 December 1966 vol 737 cc592-5
4. Mr. Buchan

asked the First Secretary of State and Secretary of State for Economic Affairs whether he will introduce legislation to ensure that the removal of the import surcharge will be accompanied by appropriate reductions in commodity prices.

5. Mr. Patrick Wall

asked the First Secretary of State and Secretary of State for Economic Affairs what new steps he is taking to see that the lifting of the import surcharge is passed on to the consumer in reduced prices.

The Minister of State, Department of Economic Affairs (Mr. Austen Albu)

As my hon. Friend the Parliamentary Under-Secretary explained in reply to the hon. Member for Lewisham, West (Mr. Dickens) on 20th October—[Vol. 734, c. 376.]—my right hon. Friend expects those concerned to recognise fully their responsibility for price reductions, bearing in mind that the removal of the surcharge should offer scope for them. My right hon. Friend does not consider that any further measures are called for.

Mr. Buchan

Would my hon. Friend not agree, in the light of the fact that we have written into our White Papers the right of firms to raise prices when taxation is imposed, that we should also write in a duty to reduce prices when fiscal measures like those which are in force are removed? This is the point of the Question. Will he take such strict measures to see that prices come down?

Mr. Albu

My hon. Friend is no doubt aware that the duty to reduce prices in suitable cases is included in the White Paper on Productivity, Prices and Incomes. We shall watch this situation closely.

Mr. Wall

In view of the increase in prices imposed on the long-suffering consumer by the Selective Employment Tax, will the hon. Gentleman take steps to see that they comply with his request?

Mr. Albu

We shall certainly do so. We shall be watching the situation and will make checks on cases where the surcharge could be assumed to have put an increase on prices in the past.

Mr. Arthur Lewis

Will my hon. Friend get from the B.B.C. a tape recording of the speech of my right hon. Friend's predecessor when this was introduced, in which he said that his Department would take severe measures to see that these prices came down? What will those severe measures be?

Mr. Albu

The situation is exactly what it was when my right hon. Friend, who is now Foreign Secretary, made that speech.

Sir J. Langford-Holt

What does the hon. Member mean when he says that duties are included in the White Paper? What duties does the White Paper include?

Mr. Albu

The criteria in the original White Paper imposed on firms the duty to reduce their prices where it was possible to do so; it also gave the Government power to refer those cases to the National Board for Prices and Incomes where necessary, and we shall do so.

16. Mr. Hamling

asked the First Secretary of State and Secretary of State for Economic Affairs, whether he will undertake to report to the House within three months what price reductions are made by those manufacturers and merchants who raised the prices of their goods because of the import surcharge two years ago.

Mr. Albu

We have no record of increases in prices by individual traders due to the surcharge, and we could not undertake to make the report requested without asking all traders to notify price reductions. My right hon. Friend does not regard this as practicable.

Mr. Hamling

Does my right hon. Friend recall that when the import levy was imposed there was a deluge of questions from the opposite benches about increases in prices? Will he refer to all those and look at current reductions in all those prices which we have a right to expect?

Mr. Albu

My hon. Friend may be interested to know that we made a study last year of the effect of the surcharge. In a very large number of cases—I think more than half—traders were absorbing the surcharge at that time. We shall certainly watch the situation now that the surcharge has been removed.

Mr. Frederic Harris

In order to get this into perspective, does the hon. Gentleman agree that when the Chancellor announced the reduction in July last a large number of importers reduced their prices because they had to do so in order to sell goods in the intervening period up to November?

Mr. Albu

In that case, they will be in the clear.

Mr. Raphael Tuck

As my hon. Friend has already stated that it is the duty of manufacturers to reduce the prices of their manufactures when the import surcharge comes off, will he see that that duty is made mandatory by legislation?

Mr. Albu

My right hon. Friend does not think that would be practical or possible.

Sir S. McAdden

Did I understand the hon. Gentleman to say that he has no record of price increases which took place at that time? If he has no record, is this what is called "purposive planning"?

Mr. Albu

I meant that we had no record of every single price increase which took place. The hon. Member knows that this would be impossible.