PRICES AND INCOMES (Hansard, 13 December 1967)

§ Mr. James Ramsden (Harrogate)
I beg to move,
That the Prices and Incomes (Continuous Review) (No. 1) Order 1967 (S.I. 1967, No. 1581), dated 26th October, 1967, be withdrawn.
This Motion, for which we have a regrettably short time, deals with two references under Section 3 of the Prices and Incomes Act. They are the first two standing review orders to be made under that Section, which alone would justify a debate on them. The two cases with which we are concerned tonight are very different. In the case of the universities, the reference to Jones supersedes other efforts, hitherto unsuccessful, to establish separate and specially constituted pay review machinery. If he catches your eye later in the debate, Mr. Speaker, my hon. Friend the Member for Worthing (Mr. Higgins) will deal fully with that.
In the case of the Armed Forces, an already established and well understood procedure for a two-yearly review of pay exists, and this we all know as Grigg. For the Forces, Grigg embodies a principle which is best illustrated by a reference to the Grigg Report itself, Cmnd. 570 of 1958. The relevant passage is under the heading, "Remuneration"— It is, however, essential that inflation should not be allowed to eat away the real value of Service emoluments, and we therefore recommend: — (I) that there should be an automatic biennial review of pay which should take into account movements in civilian earnings over a range of occupations to be determined by agreement between the Treasury and the Service Departments. At the bottom comes the Government's comment: The Government agree that Service pay and pensions should be reviewed regularly at intervals of not more than two years". One object of this debate is to get the Government to reaffirm that they adhere to that commitment and to have them clarify— this is a vital matter for the Services— whether the standing refereuce to Jones will in any way change, compromise or undermine the principles laid 576 down by Grigg and accepted by the Government as determining for the future rates of Service pay and pensions.
I shall spend a minute or two reminding hon. Members opposite of the background to Grigg. What made Grigg necessary was the ending of conscription and the decision to man the Services in future by volunteers. That meant that the Services had to offer the going rate for the various skills they required. The commitment the Government assumed for a two-yearly review had a twofold purpose— to keep rates in line, even retrospectively, and to serve as a guarantee to members of the Services, who commit themselves to a long-term career, who have no trade union and cannot strike, that their rates would not be allowed to fall out of line. Grigg is regarded by the Services as a kind of contract, and it is taken by them that the Government's word has been pledged to them. It is on the strength of that pledge that members of the Services commit themselves to engagements of six, nine or 12 years.
Governments have not found this an altogether easy bargain to keep. The first pay review in 1960 was immediately implemented: The review was held in 1962 but, to quote the Minister of Defence of the day, it was decided that in the country's general economic circumstances the increases should be made in two stages. Half the agreed increase was given in 1962, and the remainder followed in 1963. The Government made the Services accept a cut in the pay due under Grigg— a cut of the difference between the old and the new rate for the space of one year. But the principle of Grigg still stood, and by April, 1963 everybody was back on the Grigg rate. The review of 1964 started from Grigg rates and was duly and fully implemented.
That brings us to 1966, and the first review for which the present Government were responsible. It coincided with a time of crisis for the prices and incomes policy. The heat was on prices and incomes then. On 25th November, 1965, the present Foreign Secretary, then head of the Department of Economic Affairs, announced to the House a reference of Grigg to the National Board for Prices and Incomes. On 28th January, 1966, he 577 announced that the Board had recommended that the increases proposed in the review be paid in full, and that was done.
But certain things which he then said, and which the Board said in its Report, now seem to us profoundly disquieting and alarming. For example, the right hon. Gentleman said: I obviously cannot say that the Grigg system will remain unchanged for ever…What I will give to the members of the Armed Forces is a categorical assurance that if any changes are to be made we shall find ways and means of seeing that we hear views on them, and ensure that whatever changes are made will give them ' a fair do' at the end of the day. Later he said: What the 6 per cent, represents "— that is the 6 per cent, which was the extent of the Grigg award— is the needs of the forces at this moment, as determined by the Grigg formula,….".— [OFFICIAL REPORT, 28th January, 1966; Vol. 723, c. 554–6.] I. ask the House to note the words, "at (his moment".
Finally, the Board suggested, to quote from the Press notice which it put out at the time, that: … the Government may wish to consider whether the somewhat crude application of the principle of comparability, enshrined in the Grigg formula, is reconcilable with the White Paper. So much for what happened in 1966. My hon. and gallant Friend the Member ior Lewes (Sir T. Beamish) asked a Question about the Government's intention for the next Grigg review, and whether they were proposing to modify or depart from the Grigg principle. Instead of a straight answer he got a temporising answer, which did no more than refer to this present reference now before us.
I have recalled to the House how the present Foreign Secretary said that he could not say that the Grigg formula would remain unchanged for ever. We recall his phrase about 6 per cent, being adequate for the needs of the Forces "at that moment". We suspect, on this side of the House, that what the Government are planning is to take advantage of the rundown in Service manpower currently being put into operation to argue that comparability is no longer necessary for recruiting, and that therefore, they are no longer bound by the Grigg principle 578 of comparability. That is what we fear that is what all the indications point to.
We should consider what has happened. When Grigg was last sent to Jones it was in a period of crisis for the prices and incomes policy. What happened? It was sent straight back to the Government and they were told to get on and implement it, crisis notwithstanding. Now, when conditions are comparatively normal, prices and incomes-wise anyway— we are not in a period of crisis— [Interruption.] — not on the Government's showing.
Why now is there this reference to Jones? In a period of crisis it was referred, and sent back, and the Government told to get on with it. Why, unless there is some prior understanding that the review system is to be modified as a result of the reference to Jones, are the Government making this reference now?
I have one or two more questions. If Grigg is to go, have there been the prior consultations with the Services, promised by the present Foreign Secretary when he last dealt with this matter in the House? Have these taken place? If there have been consultations, and if these have resulted in any agreement about a change in policy, why has there been no announcement? Why has the House not been told? I do not wonder, if there is to be a change, and if Grigg is to go overboard, that the Government should be reluctant to face the House on this issue, but if they have made a decision, and made no announcement, it is discreditable of them in the highest degree.
Does this standing reference mean that there will not be an announcement well before April about the rates that are to come into force on 1st April? Is there to be a revision of rates as from that date? Is the procedure to operate in the normal way, or will it, as a result of this reference, go overboard? In short we want an explicit assurance from the Government that the Grigg formula still stands, bearing in mind that, in the words of the Prices and Incomes Board at the end of its last report, there was a commitment upon the Government to the Services in this context.
We want an assurance that Grigg still stands, and that it is still held by the Government to be relevant, not just for recruiting, because the needs of recruiting may vary, but relevant as a fair 579 deal for men and women who have signed on and committed their careers to the good faith of successive Governments. I hope that the right hon. Gentleman has assimilated all my questions, which were put rather rapidly, and that he will be able to give satisfactory assurances.

§ Mr. J. J. Mendelson (Penistone)
May I put a question to the right hon. Gentleman to establish the facts? Is he arguing that in 1966, when the railwaymen had a 3½ per cent, increase postponed and could not get it, the Forces received their full 6 per cent, increase and would be unfairly treated if there were to be postponement in the future?

§ Mr. Ramsden
The hon. Member falls into the mistake of confusing the two cases. The Forces' increase is miscalled an increase. It is a retrospective adjustment of the degree to which they had fallen behind at the end of any period of two years. I am grateful to the hon. Member for drawing the attention of the House to this fact.

§ Mr. Speaker
I remind the House that this debate finishes at exactly half-past eleven.

§ Mr. Stanley Orme (Salford, West)
I shall be exceedingly brief. Many of us who have opposed the prices and incomes policy in the past see no reason to alter our opinion concerning the two references which are before us tonight. That is not because of our concern for the railwaymen or any other section of workers who are involved in this problem.
My first question is this. When this reference goes to Mr. Aubrey Jones— or to Jones, to give the Board the connotation that the right hon. Member for Harrogate (Mr. Ramsden) has put upon it— how long will it stay there? What are the statutory provisions governing its return?
This is extraordinary. Here are two categories— university teachers and staffs, and the Forces— who are dependent upon Government legislation to pay them. Why have the Government shuffled this off to Mr. Aubrey Jones? Why will not they taks the responsibility to face it 580 themselves? It is like referring council house rents or other matters along the line, when the buck must come back to the very people who have sent it.
There is a dangerous precedent in this, not simply for the two items which are before us tonight, but for the whole question of prices and incomes. The right hon. Member for Harrogate said that we were moving into a period of calm in prices and incomes. I think that we are moving, to use a much quoted expression, out of a straitjacket, which has virtually been rejected, and into a period when, I hope, we shall see a lot more sense concerning incomes in the future.
Therefore, I am not prepared to see Mr. Aubrey Jones set up as an arbitrating committee. I do not see what special abilities he has for this. I do not see what special references he has for such a job. The Government should make up their own mind. If they feel that they have a case, instead of shuffling it along the line to try to lose it for a time, they should say to the House, "We believe that because of A, B or C, such-and-such should not be implemented" and let hon. Members judge for themselves.
It seems to many of us on this side of the House that we have been for a very long time at these debates on prices and incomes. I was hoping we were getting near the end of this sort of late night rendezvous with hon. Members we do not always particularly love, but whom we always seem to meet at this time of night— but that is one of the hazards, as one of my hon. Friends says, of being a Member of Parliament: you cannot always choose your company.

§ Mr. Speaker
The hon. Member must make a rendezvous with the Order we are talking about.

§ Mr. Orme
I am grateful to you, Mr. Speaker, for fetching me back to the Order.
There is an extremely serious side to this question, as I have tried to outline. I think this whole machinery, this paraphernalia of the Prices and Incomes Board, which the Government have somehow manipulated into the centre of their economic policy, should now be manipulated out of sight. I do not see it serving any purpose in the economic problems which the country has to face.

§ Mr. Speaker
With all respect, the hon. Member must confine himself to the Order. We cannot, on this Order, discuss the whole prices and incomes economic policy.

§ Mr. Orme
Thank you, Mr. Speaker. I would say to my hon. Friends that this reference about the remuneration of academic staffs of universities and the pay and allowances of the Forces is an exceedingly important reference, because this is the first reference to be debated in the House while the reference is going to the Board. Previously, these debates have been on Prayers against Orders following decisions taken by the Government. This is a reference of a principle. I am concerned not just with the Forces and the academic staffs, but with other references which can be made to Mr. Aubrey Jones, and the manner in which they might be used as delaying tactics. In consequence, I am very unhappy about this reference. I feel that it is wrong.
I say to my right hon. Friend who is to reply to the debate— for whom I have a great deal of respect, having known him for a number of years— that I am very much opposed to this reference. I would need a lot of convincing this evening before I would vote for such a reference.

§ Colonel Sir Tufton Beamish (Lewes)
The hon. Member for Salford, West (Mr. Orme) has talked a lot of sense to the House, and I hope that he has persuaded all of his hon. Friends to oppose this Order. Personally, I strongly oppose it— on two grounds.
First, I think that it will result in an unnecessary and undesirable extension of the Board's work and of its sphere of influence. Secondly, I feel that it will amount to a breach of the promise given to Servicemen about the criteria on which their pay and allowances should be based. Consequently, it will amount also to a threat to their morale, and a threat to recruiting.
I find it impossible to find a single good reason for this reference to the Board. Looking back to the last report of the Board— in paragraphs 14 and 16 of Cmnd. 2881— I find a reference to productivity. Although those paragraphs talk a lot about the relationship of productivity to Service pay, what it amounts 582 to is the rejection of this theory. This would not be a good reason at present for such a reference.
Unless the Government have sinister intentions towards the Armed Services, which I hate to think, it is difficult to see what purpose will be served by again referring Service pay to the National Board for Prices and Incomes. This would only be to repeat what was, last time, a thoroughly abortive exercise as anyone who has read the Report must agree.
What a time for the Government to choose to increase uncertainty and risk lowering morale in the Armed Forces! There has never been a moment when there was so much uncertainty, when the forces have been subjected to severe cuts in their numbers, and when morale was so low. We do not even know how far these cuts have gone, because it appears that still further cuts are threatened. There are serious rumours that this may be the case.

§ Mr. Mendelson
Will the hon. and gallant Gentleman give way?

§ Sir T. Beamish
This is a very short debate, and I really have not the time—

§ Mr. Mendelson
rose—

Hon. Members
Order.

§ Mr. Speaker
Order. The hon. and gallant Member for Lewes (Sir T. Beamish) obviously is not giving way.

§ Sir T. Beamish
Mr. Speaker, usually I like to give way, but there is little time at our disposal, and I am trying to limit myself to five minutes.
The serious condition of the Services from the point of view of morale and the uncertainty which men and women have of a career has been made clear by the Secretary of State, who has told us that the Services are being asked to accept risks which they would not be asked to accept in normal circumstances—

§ Mr. Speaker
Order. It would not be out of order if the hon. and gallant Gentleman referred to the Order before the House.

§ Sir T. Beamish
Thank you for warning me about that, Mr. Speaker. My remarks were directed to the background against which members of the Armed 583 Forces will see this reference of their pay and allowances, pensions and gratuities to the Board. I speak as an ex-Serviceman, and this must be in the mind of everyone in the forces. But, of course, I will make direct reference to the Order.
After many years of bad pay and poor conditions, men and women in the Armed Forces found a new formula, the Grigg formula, and they were pleased when it was produced. They saw it working during the 1950s and 1960s, and they felt that at last they had some certainty. They knew for sure that their pay and allowances would be kept in step with civilian conditions.
Now we are told that this reference is to be made to the National Board for Prices and Incomes. I am sorry that no Minister has intervened earlier in the debate to tell us the criteria on which the Board is to base its decision. We have been told nothing about them.
The Armed Forces climbed up a Conservative ladder in the late 1950s and early 1960s, and hon. Members on both sides of the House were glad that that was so. If they are now to slide down a Socialist snake, it will be a very sad day. The Grigg formula worked very well, although it had deficiencies and could have been improved. The fact that this matter was considered only once every two years was perhaps too long a gap, because it meant that Servicemen got too far behind their civilian counterparts. But they put up with it with a smile.
I hope that we shall be told when the Government made up their minds definitely to abandon the Grigg formula. I have before me two publications entitled "This is the Army". The first, published two years ago, makes a definite reference to the Grigg formula, but it appears that, for the last 18 months, all reference to it has been dropped.
I would like to know whether this is yet another example of the Government making up their mind about what they will do before getting Parliamentary approval and going along on those lines. There is no reference to the Grigg formula in any recruiting literature that I can find during the last 18 months. It appears to me that the Government made up their mind about this long before they consulted Parliament. We have 584 seen all too many examples of that kind of thing recently.
Not only are we being asked to refer pay and allowances to the Prices and Incomes Board, but also pensions and gratuities. No mention has yet been made of this. I want the Government to make clear whether Armed Forces pensions are to be decided and recommended upon by the Prices and Incomes Board. Armed Forces pensions are tied up with retiring on half pay and all the rest of the things we were told about by the Government, but about which nothing has been done.
May I ask the specific question, if the occupants of the Government Front Bench can stop chattering, whether the pensions of the Armed Forces are also to be decided by the Prices and Incomes Board?
We all remember very well that promises were made at the time of the 1964 General Election offering parity to Armed Forces and public service pensioners. The chairman of the party opposite made the promises and the Prime Minister made the promises— at least that is how they were understood— but nothing has been done. Is this now to be shuffled off to Mr. Aubrey Jones? We want to know and are entitled to know.
I promised to be brief. There are a great many other points that I could raise, but I will content myself with raising one last brief point. I have a letter here drawing my attention to the fact that retired members of the Armed Forces and widows living overseas have found their pensions decreased as a result of devaluation. This reference includes Service pensions. Will the Prices and Incomes Board be looking into the question of the restoration of the devalued part of the pensions of people who have served in the Armed Forces, or their widows, who are living overseas and who have seen their pensions reduced? Are we to have a direct answer, or nothing but waffle from the Government, as usual? I look forward to their reply. I hope that the House will be persuaded by the three speeches which have been made that this is a thoroughly bad Order.

§ Mr. J. J. Mendelson (Penistone)
I very much regretted that the hon. and 585 gallant Member for Lewes (Sir T. Beamish), in the light of my past experience of him in many previous debates— and I have often followed him — refused to give way on this occasion— [Interruption.] I would like to make my own speech, whatever hon. Members on the other side have to say, and I have only just started.

§ Mr. Hugh Fraser (Stafford and Stone)
Get on with it.

§ Mr. Mendelson
It is my business to get on with it and not for other hon. Members to tell me what to do. They must be patient.
I want to make a point of capital importance which must be cleared up. The debate tonight is not on the same lines as the previous 14 that we have had in the House on Prices and Incomes Orders. No attempted propaganda engaged in by hon. Members opposite will be able to cloud the issue. On previous occasions the Orders that have come before the House, at this late hour, as one of my hon. Friends has said, were concerned usually with groups of workpeople — sometimes a small group as few as 14 and sometimes a few hundred— who had been prevented from enjoying an increase which their employers were prepared to grant, or, in other cases, which they had legitimately claimed and which their employers were about to grant.
What many of my hon. Friends and I objected to, and what we refused to support, was the implication that the criminal law would ultimately be used against these workpeople if they tried to persuade their employers to act in accordance with what they had already agreed. That is not the position that the House faces tonight, and it would be an act of utter confusion if we were to think that these two cases move on all fours with each other.
The special pleading that we have heard from the other side of the House confirms me in my view, if it needed confirming. I asked a question of the right hon. Member for Harrogate (Mr. Ramsden), who opened the debate for the Opposition. I asked whether he was claiming that, although the Armed Forces had received a 6 per cent, increase in 1966, in some way, on ethical or moral grounds, it could be argued that the members of the forces were, therefore, 586 worse off than the railwaymen who, as the right hon. Gentleman knows, had a 3½ per cent, increase— not 6 per cent.— postponed for six months, although there was only a few hours difference between the agreement and the coming into effect of the Order. He gave me no answer. He shuffled away from answering the question. It is clear that the Armed Forces were treated in a much more advantageous way in 1966 than railwaymen have been treated. There is no doubt about this.
There is involved here the attitude of the people concerned. It is my information that the Association of University Teachers— and this has not been mentioned so far— does not oppose this reference. This is a matter of capital importance. My right hon. Friend may be able to say, from his own knowledge, through being involved in this, that the Association is in favour of it. I am saying that the Association is not opposed to it, and in the advice which I have given to my hon. Friends on previous Orders I have always been guided by the views of the people concerned. I am, therefore, not prepared to oppose this reference, bearing in mind that the Association of University Teachers, a professional organisation of the people directly involved, is not opposed to it.
The Armed Forces are not in the same position, because they do not have a trade union. I understand this, and, like many other hon. Members, I am concerned to ensure that members of the forces are properly looked after, and are treated fairly. There is no doubt about this in my mind, and I have as many Service associations as have other hon. Members. There is nothing between us on this.
If there is to be a complete adherence, without any reconsideration, to what the right hon. Member for Harrogate called the Grigg agreement, is the hon. and gallant Member for Lewes going to apply the same principle to the policy which the Leader of the Opposition and the right hon. Member for Enfield, West (Mr. Iain Macleod) have urged on the Government, namely, that there must be a cut in the standard of living of working people in this country, but the trade unions must be prevailed on not to make applications to make up for this? I have not heard the hon. Gentleman or 587 anyone else on the benches opposite make that case.
I have not heard them urging the General Council of the T.U.C. to say, "There will be an increase in the cost of living because of devaluation, but we must, in no circumstances, accept a cut in the standard of living of our members". On the contrary, the Leader of the Opposition is on record as almost indicting the Government for not bringing it home speedily enough to the trade unions that they must accept a severe cut in the standard of living of their members, and must not put in wage claims to make up for the cut. Hon. Gentlemen opposite want to apply this special kind of pleading to one section of the community, the Armed Forces.

§ Captain Walter Elliot (Carshalton)
Would not the hon. Gentleman agree that tonight we are not considering an increase in pay for the services? The Grigg Committee recommends an increase so that the Services will keep level with outside industry.

§ Mr. Mendelson
It is the experience of all trade unionists, and certainly of the railwaymen to whom I have referred, that they are always nine to 14 months behind increases in the cost of living. I do not have time to give the statistics, but I think that the hon. Member for Oswestry (Mr. Biffen) will agree with me on that.
I am pointing out the hypocricy of the hon. and gallant Member for Lewes. He is a firm supporter of the Leader of the Opposition in his view that trade unionists must accept a cut in their standard of living, but he is pleading for special treatment for one section of the community.

§ Mr. Orme
rose—

§ Mr. Mendelson
I do not think that I should give way. There is very little time left.

§ Mr. Speaker
Order. I remind hon. Members that this debate ends at half-past eleven.

§ Mr. Orme
My hon. Friend should address himself to the principle of the Order.

§ Mr. Speaker
Order.

§ Mr. Mendelson
I shall not be a party to the hypocrisy of the Opposition getting away with it this evening. This Order is different from the other 14 Orders which have come before the House. It confines itself to a reference for a continuing review. I have never on principle said at any time, nor voted in accordance with such principle, that I want to deny to the Government for all time the right to have that means of review, particularly with the consent of the professional people involved, reviewing the kind of circumstances which apply to their salaries and other things. It would be absurd to deny the Government such powers, and I have never opposed any such review on principle.
My opposition has been to the coercion of a small group of people, and that was the subject matter of other Orders which we have debated in previous debates, which potentially applied the criminal law to them if they had already negotiated an increase which the employers were prepared to pay but the Government then said that they must not have it. That is not the position tonight. I see no objection to this reference and I shall find it easy to support the Government in going forward with it.

§ Mr. Terence L. Higgins (Worthing)
It is unfortunate that the first debate on what is clearly a new series of prices and incomes debates is one in which we have such an extremely short time for discussion. I understand, Mr. Speaker, that no fewer than 16 hon. Members are trying to catch your eye. The Minister would like 15 minutes to reply to the debate, and I shall do my best to restrict myself to five minutes in the hope that another hon. Member may speak before the Minister replies.
It is very important that we on this side of the House should stress that as on former occasions we are firmly against the Government's statutory prices and incomes policy. We have continued to repeat that. We believe that the policy is discriminatory and unfair, and that the Government's claim that it is universal and fair is complete and blatant nonsense.
What the Government are seeking to do by moving an Order to arrange for a 589 continuous review by the Prices and Incomes Board is to supersede well-established procedures which have worked well and fairly in the past and also to impose a review which is a substitute for such a sensible review body for university teachers. It is true that in Committee on the Prices and Incomes Bill we did not vote against this Clause, although we expressed some grave doubts about it, and those doubts this evening have been completely and utterly justified. Every objection raised in Committee by my hon. Friend the Member for Oswestry (Mr. Biffen) has been fully justified by the way in which the Government are proposing to refer these two cases. I hope that the Minister will tell us whether he proposes to refer other cases under this procedure and whether it will have the universality which the Foreign Secretary said it would have when he spoke in Committee in 1966.
I want in the short time available to me to pick up a point made by my hon. and gallant Friend the Member for Lewes (Sir T. Beamish): which criteria are the Prices and Incomes Board to apply in this case? The answer is that they will be applying the criteria set out in Cmnd. 3235. And yet it is clear that the statements in that White Paper which formed the Schedule to the 1966 Act are utterly obsolete. May I quote one passage of the document which Mr. Aubrey Jones must bear in mind when he considers these cases: The July measures have had considerable success. Exports have been advancing strongly and the trade gap has been narrowed. The balance of payments has improved considerably and was in surplus in the fourth quarter of last year. Sterling has been greatly strengthened and the gain to reserves has made it possible to repay a satisfactory amount of short-term debt. That was written into the Act which Mr. Aubrey Jones has to consider when he appraises the two cases which the Government propose to refer to him. Yet if hon. Members look at the Evening News tonight they find the headline £153 million— it's the biggest gap ever". It reads: Britain's import bill soared alarmingly last month, putting our trade with the rest of the world deeper in the red than ever before. It is a very serious point that the Act under which these cases are being re- 590 ferred is completely obsolete. We on this side of the House believe that it would be quite wrong to supersede well-established procedures provided by the Grigg Committee and to set up instead a reference to the Prices and Incomes Board. I hope that the right hon. Gentleman will give us a clear answer as to whether or not this will supersede the Grigg procedure.
This reference in respect of university teachers will be considered not by the Jones Board, but by a series of consultants employed by it. These consultants, who might themselves be university teachers, will prepare the case relating to whether their salaries should go up or down. The Order does not make it clear whether they will consider the whole remuneration of teachers or their earnings in other respects as well, or the fees which they will be getting from the Board for considering what their total remuneration is.
This is the kind of ridiculous situation which arises from the secrecy which the Government impose on who actually gives the information to the Jones Board. I have had very little time tonight. A number of other points should clearly be answered, but we believe that this is yet another example of how the Government's prices and incomes policy has become nothing short of a farce.
I hope that my hon. and right hon. Friends will join me in the Lobby tonight.

§ The Chancellor of the Duchy of Lancaster (Mr. Frederick Lee)
As my hon. Friend the Member for Penistone (Mr. Mendelson) pointed out, this is the first occasion in this long series of Prayers on which the Tories have not been acting as a Sir Gallahad looking after a few people who are being abused.I was rather surprised that my hon. Friend the Member for Salford, West (Mr. Orme), whom I respect highly and whose approach to these matters I much admire, should fall for the idea that, on an issue like this, the Tories are concerned about the matters which concern him —

§ Mr. Orme
I am not worried about the Tories.

§ Mr. Lee
The right hon. Member for Harrogate (Mr. Ramsden) rightly said that this action is being taken under Section 3 of the 1966 Act— [Interruption.] For goodness' sake be quiet if you cannot do anything better.
Within that Section, provision is, of course, made for prices and incomes to be kept under continuous review, the formula being that the Secretary of State first has to make an Order applying that Section to the kind of price or income in question and the Ministers concerned then join him in ensuring that the issue goes to the Prices and Incomes Board.
The whole purpose of this procedure is to ensure a degree of Parliamentary control, which is precisely what we are doing tonight. It is astounding that, using the very facility which we are determined to provide Parliament with, the Opposition say that this is a dictatorial attitude to which they must object.
In this particular instance, we must consider, first, the remuneration of the academic staff of universities— hon. Members opposite seemed to forget this for most of their discourse— and, secondly, the pay, allowances, pensions and gratuities of members of the naval, military or air forces of the Crown, and any women's services administered by the Defence Council.
We have heard about the sanctity of the Grigg formula. It was most touching to hear that, especially from the right hon. Member for Harrogate. May I quote him? On 8th March, 1962, in reply to something said by one of my hon. and learned Friends, he said: On pay, the hon. and learned Gentleman suggested that the Government had broken the promise they made when accepting the Grigg Committee's recommendation for a biennial review. This is not so. We have carried out the biennial review and are to increase pay to the extent the review justifies. It is perfectly true that the increase will be given not in one step but in two, but the plain fact is— and I think that the Committee will accept this— that to pay the whole of the increase justified by the review straight away would be contrary to the need for restraint which the present economic position of the country imposes, and that is why we are spreading the increases equally over two years."— [OFFICIAL REPORT, 8th March, 1962; Vol. 655. c. 755.] Now hon. Gentlemen opposite wish to indict us merely because we are not trying to rob the forces of anything. But that was the effect of what the right hon. Gentleman did in 1964. Indeed, when 592 the issue went in 1966 to this much despised Prices and Incomes Board, it was agreed that it should be paid in full, which was far more than the then Tory Government did two years earlier. The hypocrisy of all this is monumental. [AN HON. MEMBER: "Take it easy, Fred."] I will take it easy, all right, but hon. Gentlemen opposite must take the facts.
My right hon. Friend the First Secretary has been quoted. This is what he said in January, 1966: What I will give to the members of the Armed Forces is a categorical assurance that if any changes are to be made we shall find ways and means of seeing that we hear views on them, and ensure that whatever changes are made will give them a fair do at the end of the day."— [OFFICIAL REPORT, 28th January, 1966; Vol. 723, c. 554.] I suggest that what we are now doing honours that obligation, for the Board will take evidence not only from the Ministry of Defence, which, in addition to its responsibilities as employers, will also have to represent the Servicemen's interests as well. The Board is also free to take evidence from anyone who it thinks can make a contribution to its final conclusions, and that includes every member of the Armed Forces.
If hon. Gentlemen opposite are interested in the democracy of all this, cannot they see what an advance it is for the ordinary "squaddy"— the private soldier — to be able to be called to give evidence on his own behalf before the Board, something which is utterly without precedent? Thus, the answer I give to hon. Gentlemen opposite is that we are honouring the undertaking given by the First Secretary; that is, that there will be the facility not only for the employers, in the form of the Ministry of Defence, to give evidence, but that the Board may ask people other than the employers— in this sense, the equivalent of the employees— to give evidence to the Board itself.

§ Mr. John Biffen (Oswestry)
When the right hon. Gentleman says that the Board itself will take evidence, are we to assume that, in this instance, it will not under any circumstances be employing consultants to do the job on a sub-contract basis? If something is done which is contrary to any principle that has hitherto been followed, will he publish the names of those consultants so that people can approach them?

§ Mr. Lee
There will be no change in the Board's procedure on this matter. If it wishes to employ consultants, it will be open to it to do so. [HON. MEMBERS: "Answer."] I am answering. If hon. Gentlemen opposite shut up for a moment they will understand my answer. There is no provision for the Board to be compelled to disclose the names of the consultants it employs. I should have thought that this covers all the fears which hon. Gentlemen opposite are expressing.
To answer the questions asked by the hon. and gallant Member for Lewes (Sir T. Beamish), in this respect pensions are not included.

§ Sir T. Beamish
Why not?

§ Mr. Lee
At this stage we think that it would be wrong. We think that, for the initial stage, it would be sufficient for it to be able to look at pay rather than to go into the question of pensions, which it may well do later.

§ Sir T. Beamish
rose—

Hon. Members
Sit down.

§ Mr. Lee
The hon. and gallant Gentleman is alluding to what is in the Schedule. I have already explained that my right hon. Friend will then give an instruction to the Board. That instruction is on what the Board will work, and it does not contain pensions, and so on. Perhaps the hon. and gallant Gentleman will now withdraw his remarks.
Whereas the forces themselves are quite unable— because of disciplines which are essential to them— and never have been able, to give evidence on their own behalf, they will under this system be able to do so.

§ Mr. J. Enoch Powell (Wolverhampton, South-West)
Are we to take it that it is the intention of the Government at a later stage to refer pensions to the Board?

§ Mr. Lee
I ask the right hon. Member to await the report of the Board on pay. It would be quite wrong, would it not, for us to try to adduce what kind of pensionable employment we are engaging in if we do not know the conditions of pay engaged in? [Interruption.] Ignoring the hyenas, some hon. Members have pointed out that the Grigg reviews take place every two years. It can be expected that the frequency of reviews by the Board will not be less than it was 594 under the Grigg system. Already the Board has been reminded that the next review under the old system would have been due on 1st April, 1968.
Hon. Members asked if we can predict what the reports of the Board will be, but this is utterly impossible. What would be the point of referring to the Board these, or wages or other cases if we could predict what the reports would contain?

§ Sir T. Beamish
May I ask a question?

§ Mr.Lee
No. [HON. MEMBERS: "Oh."] I suggest, Mr. Deputy Speaker, that it would be a good thing if we were permitted to debate in order.
One would not attempt to forecast decisions arrived at by the Board. The action we are taking is not to be construed in any way as vindictive action against either the forces or any other body of people about whom references are made to the Board. The Board will review objectively the conditions obtaining at the time it makes its review upon criteria which is now the basis upon which we review any other kind of income.

§ Sir T. Beamish
By what criteria?

§ Mr. Lee
Let us get this clear. For the Armed Forces there is no review body in existence. Grigg is merely a formula. It is something which does not exist except as an equation on a piece of paper. For hon. Members opposite to argue as if there were a review body in existence such as obtains in certain other professions is complete nonsense.
The same position obtains for university teachers. I have before me the National Incomes Commission Report No. 3, in which the Tories referred the university teachers to the "Three Wise Men". Their terms of reference were: matters relating to pay or other conditions of service or employment where the cost is met in whole or in part from the Exchequer". Practically the same set of criteria as the Board is using was used by the N.I.C. when the Tory Government referred university teachers pay to that Board. To take it further, to bring it more into line, the N.I.C. was to have regard both to the circumstances of the case concerned and to the national interest". The one matter which is not covered by Grigg is the national interest. Is it to be said that we should exempt one 595 class of persons, in this case the forces, from the criteria which include the national interest? Is it to be said that we must do that when, within the N.I.C. set up by the Tories, that same criterion was used in the case of university teachers?
There has been discussion between the university teachers and ourselves. Their complaint, in fact, is more about the time it has taken for us to reach the stage when we can refer the matter to the Prices and Incomes Board. In their case, also, there is no review body in existence. On the last occasion, after the matter was determined by the N.I.C, the N.I.C. went out of existence. There is, therefore, no question here of supplementing one review body by another. There is no such review body in existence for the forces or for the university teachers.

§ Mr. Norman Atkinson (Tottenham)
I do not think that my right hon. Friend is quite right in saying that there is no review body in existence. There is one which operates in the universities and has done for a number of years. University academic staffs now operate under national agreements.
On another point, does my right hon. Friend recall the assurances which have been given by the Government that the Prices and Incomes Board would never become a wages council, that it would not initiate reviews into wage structures, but would be there only for the purpose of analysing decisions taken by other wage bodies?

§ Mr. Lee
I do not accept that there is any review body in existence for university teachers. It is purely a matter of discussion with vice-chancellors and the Government. But what we are now doing, for the first time since the N.I.C. went out of existence, is bringing in a body to which the university teachers themselves can give evidence. For their part, they accept that this is a far better method than they had before.
In contradistinction to all the other Prayers we have had on this subject, therefore, neither of the issues raised here is opposed by the people concerned, and in one case they are positively in favour of it. Why any of my hon. Friends should have any hesitation in supporting the Government, on a matter of this kind, I cannot understand.
596 I end as I began [Laughter.] It must be past bed-time for some hon. Members opposite. I assert that the object of the exercise is to bring into being an authority which at present is lacking in both cases. There is no question of disagreement as between ourselves, the university teachers or the Armed Forces. I remind hon. Members that the Armed Forces did extremely well out of the only reference which ever went to the Prices and Incomes Board. If I had time, I would quote the figures.
I give the House an assurance that there is no question of the Government's taking a vindictive line towards any worthy body of people. It is merely a matter of trying to bring these groups, who at present are without any kind of review body, into line with the rest of the community.

§ Mr. Eric Lubbock (Orpington)
If I had to make up my mind on this Order on the merits of the speech which we have just heard from the right hon. Gentleman, I should oppose it wholeheartedly. I never listened to such a rodomontade of nonsense as that to which we have just been treated by the right hon. Gentleman. He has not answered the question which was asked by more than one hon. Member: why these particular wages, salaries and pensions have been chosen by the Government, out of all those which they could have picked, to refer to the National Board for Prices and Incomes under Section 3 of the Act. This first reference is one on which we shall need a very thorough explanation, so that we can see how the Government's mind is working, and how future references under the Section will be treated.
I accept that the Association of University Teachers has been consulted—