PRICES AND INCOMES (NO. 2) BILL

HC Deb 10 July 1967 vol 750 cc102-361

As amended (in the Standing Committee), considered.

Clause 1.—(POWER TO EXTEND PERIODS OF STANDSTILL UNDER PART II OF PRICES AND INCOMES ACT, 1966.)

3.50 p.m.

Mr. John Nott (St. Ives)

I beg to move Amendment No. 2, in page 1, line 8, after 'prices' to insert 'other than retail prices'.

When the dangers of cost-push inflation first became a serious topic of study, in the 1950s, a proposal was developed to introduce a policy of productivity, prices and incomes. In this form, with the emphasis on productivity, the policy was, on the whole, a constructive one.

During the past two years, under the Labour Government's administration, the whole prices and incomes policy has become more and more negative and is now concentrated almost wholly on controlling prices and restraining incomes rather than on encouraging productivity. Month by month we see examples of the Government's proliferating controls and interference and of their becoming more and more dictatorial about prices and incomes; so much so that the whole of the market mechanism is beginning to break down.

Proposals are now being put out by the Government for commando teams led by Mr. Aubrey Jones to investigate price increases in the shops. The Amendment, which relates to retail prices only, draws attention to a matter where the Government are getting increasingly into deep water and where it is possible and easy to show that control of retail prices through the National Board for Prices and Incomes is not only unnecessary, but is also unworkable, impractical and undesirable.

Although I am personally violently opposed to a policy of retail price control, I fully appreciate and understand why the unions have been demanding it. The unions, which have suffered from Government interference in the free bargaining of wages and which have had contracts entered into between employers and employees forcibly severed as a result of the Government's prices and incomes policy, have rightly and understandably demanded as a quid pro quo that there should be a peg on prices as well.

The fact that the unions have demanded a policy for prices is not in any way to be held against them, but prices are the only way in which demand can be kept in balance with supply. If the Government believe that they, by interfering in the price mechanism, and, in particular, with retail prices, are able to improve upon the market and the means by which it can keep demand in balance with supply through the flexibility of prices, the policy has reached a most remarkable stage of stupidity.

The first thing to be said about retail prices and their control is that this type of reference to the Board is unnecessary. The retail trade is fiercely competitive and, with the abolition of resale price maintenance, is becoming more so. The scope for retailers to raise prices unreasonably is very limited indeed. In no field are the sanctions and benefits of a competitive free market more obviously to be seen than in retail prices.

The extent of the competition in the retail trade is evidenced by the figures produced by the Department of Economic Affairs in its June progress report. The report shows that, of the 2½ per cent. rise in retail prices which took place between July, 1966, and April, 1967, 1 per cent. was purely the result of Government action in increasing Purchase Tax, in imposing Selective Employment Tax, and in increasing postal charges. A further 1 per cent. was accounted for by seasonal price increases. Therefore, a large proportion of the 2½ per cent. rise in retail prices which took place was due to increased taxation by the Government. Another large proportion of it was due to seasonal price increases. Only ½ per cent. of the 2½ per cent. could be attributed to price increases to improve retail margins.

During the same period of July to June average earnings rose by 1.5 per cent., against retail prices which rose by ½ per cent. if one takes purely those aspects of retail prices which could be attributed to increased margins on the part of retailers. Likewise, from April, 1963, to April, 1966, retail prices rose by 11½, per cent., whereas average earnings rose by 25 per cent.

Earlier this year the Minister of Agriculture said that he had no evidence that retailers are in general working to excessive margins and"— that he did not— propose to introduce legislation."—[OFFICIAL. REPORT, 10th May, 1967; Vol. 746, c. 242.] This was a perfectly fair statement, because the rise in prices had come about predominantly through increases in Government taxation and through seasonal fluctuations and not through profiteering on the part of retailers.

I take a department store as an example of how difficult it will be to introduce any kind of enforcement of retail price control. A department store may sell 300,000 individual items. Its pricing must be related to its costs. It is virtually impossible in such a store to isolate individual items, as, clearly, would have to be done if a retail price were referred to the Board. Only now is it becoming possible to say that during last year retail margins were stable. How will it be possible to refer a particular retail price to Mr. Aubrey Jones's Board and for him to report within one month that that price is unfair when it is only now becoming evident, some six months after the end of the year, that retail margins were stable last year?

The fact that the Jones Board is expected to make an investigation and, within one month, denounce a price as being unfair—presumably it will be entitled to denounce a price as being unfair, even though the price is competitive—is evidence enough that the whole idea of referring retail price increases to the Board is thoroughly impracticable. Day by day retailers are making adjustments to prices to accord with adjustments in their suppliers' margins, to accord with seasonal adjustments, and also to hold their own stores margins which come about to cover their own costs. It would be impracticable and unworkable for any board consisting of 20 men to pronounce on retail prices as being fair or unfair or reasonable.

What happens if the Board sets a price limit to a commodity which is being sold at 10 separate shops down the high street? The suggestion that this should be done is one of the most remarkable aspects of the Government's policy that we have yet seen.

Why are the Government attempting to do so? I fear that it is because the First Secretary invited housewives to write to him about price increases, as a result of which I believe that he has had about 18,000 letters complaining about price rises in the shops. I do not think that there has ever been a clear statement to show how many of these price increases have been attributable to a rise in retailers' margins. In view of the figures published by the D.E.A., I doubt whether many of the increases have been attributable to increased retailers' margins.

It is because the First Secretary is now bombarded with complaints on price increases that he is suggesting that retail prices should continue to be referred to the Board. This is the way in which he is trying to convince the country that he can do something to hold prices in check.

Finally, we on this side are well aware that there are many families, particularly pensioners, who are unable to bear a further increase in prices. Hon. Members must be aware of this from their constituency correspondents. Surely the way to tackle the problem is to revise the Welfare State so that it becomes more selective and so that those families who are living in poverty, and pensioners in need, are helped and are able to pay the prices they are being asked for in the shops. The way to do this is not to impose controls and to refer retail prices to a Board which cannot possibly be more effective than the market mechanism.

The Government's whole policy on prices and incomes is an absolute mess. They have not tackled the really important questions which remain unanswered. Some of the unresolved questions about which we should like to hear are these: how does one measure an increase in productivity—

Mr. Speaker

Order. The unresolved questions the hon. Gentleman must raise on other Amendments, not on this.

Mr. Nott

I conclude by saying, then, that the Government's proposals to refer retail prices to the Prices and Incomes Board are unworkable. They involve an unwarranted interference with the market mechanism. The suggestion that there should be a team going about to investigate rises in retail prices is impractical. The only way by which retail prices can be held down is by increasing productivity in the retail trade, and that can come about through greater competition.

4.0 p.m.

Mr. John Peyton (Yeovil)

I support the excellent speech made in moving this Amendment by my hon. Friend the Member for St. Ives (Mr. Nott). When the right hon. Gentleman, some time ago, requested that the public should report to his Department any price increase which they thought unreasonable, he was asking for trouble. I believe that he got it. He well deserved it, because that request was merely the futile fruit of an even more puerile policy.

We are running into the serious danger of attributing to the comparatively innocent Mr. Aubrey Jones and his colleagues an ability to be everywhere and to know everything. I do not believe that Mr. Jones would accept the attribution. Nevertheless, I think it dangerous that a board of this kind, with rather loose powers of supervision, at least at first, should be called upon to conduct an operation of this sort. As my hon. Friend said, the Government's prices and incomes policy is a mess, and now to engage in an exercise of interference on a massive scale to deal with any complaint which is made, and to have a commando—I think that that was the expression used at one time—to examine increases in retail prices is to undertake an exercise which simply cannot be performed and should not be performed in a free society.

When the first Prices and Incomes Bill was introduced by the right hon. Gentleman who is now Foreign Secretary I said that the Government were taking a step down a wrong road and that, being human—one must concede that to all Governments—they would, when they found that they were wrong, merely take another step down the same road. The proposal before us now is a good instance of the truth of that observation. The Government are being led, in pursuit of an absurd policy, into ludicrous measures. I very much hope that they will think again before they further discredit themselves and the whole machinery of Government by taking on a load which no Government can or should discharge. My hon. Friend was absolutely right in all he said, and I support him with enthusiasm.

Mr. R. T. Paget (Northampton)

What I find a little odd about the Government's proposal to control retail prices is that they have been so enthusiastic in destroying the only method yet devised which did effectively control retail prices, namely, retail price maintenance agreements. When one had manufacturers concerned for the repute of their products and deeply concerned as to the prices at which they were passed on to the consumer, one had an effective level of prices, and it did not always work only one way. One remembers the tremendous effort put in after the war by the motor car manufacturers to prevent the exploitation of the shortage by the retailers. That worked very effectively. I cannot believe that anyone other than the manufacturer can police a system of this sort.

If we want to control retail prices, we shall have to get over our prejudice against retail price maintenance, because that is the only way we shall do it effectively. If we can, working through the manufacturer and, perhaps, through the Jones Board, work out a basis for fair prices at the various levels, we can have an enforceable system.

I speak on this question largely because, a good many years ago, I did a lot of work on it on what was called the Lucas Committee, which considered how to control retail prices of agricultural and garden produce. The proposal which we then put up was that the system should be worked entirely through the market, that, if one controlled the wholesale market, then the write-ups on the wholesale market price could be controlled within a maximum.

I do not believe that, unless we control the wholesale link, it will be remotely possible to control the retail price when we come to that end. It just is not a policeable method. It reminds one a bit of speed limits on the road. We have not got the machinery to make them effective. Unfortunately, although there is no direct profitability in exceeding the speed limit, there is every profitability in exceeding a controlled price. Therefore, we shall have even more mischievous results in the shops than we have already on the roads.

Mr. Geoffrey Wilson (Truro)

I support the Amendment. When it was first proposed that there should be commandos and the rest for the examination of retail prices I expected to receive a number of complaints from my constituents about this and that retail price. In fact, I have had none. I receive a good many complaints about the nationalised industries, about coal, gas, postage stamps, and so on. I do not believe that the general public are in any position to judge whether a retail price is reasonable or unreasonable, or whether an increase is fair or unfair. It seems to me that, at best, it will be very much a hit and miss business.

Mr. J. J. Mendelson (Penistone)

The hon. Gentleman says that he has had no correspondence. I have had over 100 letters complaining about increases in retail prices. My constituents are perfectly capable of judging a price after it has been increased, and I am certain that the hon. Gentleman's constituents are equally capable of doing it.

Mr. Wilson

I can only repeat that I have had no complaints. Perhaps there are people in the hon. Gentleman's constituency who are taking more interest in this matter. As I say, I think that it will be very much a hit and miss affair as to whether any complaint is made or not. I greatly doubt that the Government's proposals are satisfactory or workable, and for that reason alone I support the Amendment.

Mr. Mendelson

This Amendment gives me the first opportunity to intervene in the debate on this important Bill. I think that I speak for a good many of my hon. Friends who are in the same position, seeing that many hon. Members on these benches who expressed strong criticism of the Bill were not on the Standing Committee. I begin by making that point and saying that, at least so far as some of my hon. Friends and I are concerned, there will be no repetition of what we were not able to say in the Standing Committee.

The point of the hon. Member for Truro (Mr. Geoffrey Wilson) is of capital importance. He said that the public are not capable of judging whether increases are justified. If he put this point to public meetings, the response would be a rough one. Hon. Members know that, during recent weeks, the main subject of discussion with constituents, regardless of party, has been retail price increases.

In fairness to my right hon. Friend, he has never denied that there have been some increases. He would not think of doing so, in the face of the facts. He has argued that there has been a more limited increase than would have been the case under previous Administrations, or in different circumstances, and that, as there was a heavy increase in earnings just before the introduction of the Prices and Incomes Act—

Mr. Speaker

Order. With respect, that point must come some other time. The hon. Gentleman must confine his remarks now to this Amendment.

Mr. Mendelson

With respect, Mr. Speaker, the Amendment deals with retail prices and my right hon. Friend has recently made statements dealing with them. The reasons for increases must be part of the subject of the debate. I made only a passing reference to it, but I had to make it.

My right hon. Friend said that, as there had been considerable increases in earnings before the Act came into force, it was to be expected that there would be—

Mr. Speaker

Order. I hope that the hon. Gentleman will take note of what I say. The Amendment seeks to exclude retail prices from those which are controlled. The hon. Gentleman will have opportunity to talk about the general issue of prices at some other stage.

Mr. Mendelson

I see the issue as the possibility of controlling retail prices and the hon. Member for St. Ives (Mr. Nott) —it is rare that I seek to challenge your Rulings, Mr. Speaker—is trying to exempt all retail prices.

To use Parliamentary language, this Amendment would completely emasculate 50 per cent. of the Bill, and this crucial Amendment must be discussed. Our experience of retail price increases is that a one-sided position has been created, as many of us predicted. Under this Bill, which will continue some of the Government's policies and the previous legislation, we will have the same experience. This is not incomes and prices legislation, but legislation heavily concentrated on the control of wages—

Mr. Speaker

Order. The hon. Gentleman must take note of the previous observations of the Chair. These points might be made on Third Reading, but not on this Amendment.

4.15 p.m.

Mr. Mendelson

The exemption of all retail prices means that the Government would have no power to control retail prices. In considering the Amendment, it is crucial to judge whether the retention of what the hon. Gentleman wishes to remove would give an effective price control policy. Without such a consideration, no one can make a case on the effectiveness of the proposed legislation. If the hon. Member has his way, there will be no control of retail prices, and the Government have been arguing that this is a prices and incomes policy.

Although I would oppose the hon. Gentleman's attempt to emasculate the Bill on the prices front, and to prevent my right hon. Friend having any powers, I would like my right hon. Friend to tell us how he sees his opportunities under the current legislation, if the House rejects the Amendment, for effectively controlling prices. The House would make it too easy for my right hon. Friend—I have no intention of doing this, as this is of paramount importance to my constituents and to people in general and will be for many months to come—if we merely accepted his advice to resist the Amendment. If the Government merely argued that they should retain the powers in the Bill, it would be too easy.

I am putting the kernel of the argument. Given that the appeal which he will make to reject the Amendment succeeds, what detailed proposals has he, under these powers, to control prices effectively? I did not want to stray out of order, but I cannot put this point with any force unless I make my complaint, which is that of many people throughout the country, that the powers so far have been completely ineffective in controlling prices. He must tell us how he intends to proceed in future and whether he hopes for more success than in the past.

Mr. Michael Alison (Barkston Ash)

The hon. Member for Penistone (Mr. Mendelson) was concerned with whether, the Amendment were accepted, the Government would not have enough control over retail prices, but he mised the burden of the argument, not only that the vast proportion of retail price increases are within the Government's power to control but that recent increases have been largely due to Government action. The Government are resorting in the proposal to examine retail prices and the way that this has been brought to the public's notice, to the kind of doubtful "leaked" stories similar to the D Notice story in the Daily Express.

This could be called the "L.S.D." story with the news of the shock "commando" scrutinising individual prices. This is the worst sort of intimidation, and uncertain shadow Government by innuendo to which we are becoming accustomed under present Ministers, and it will not do.

The First Secretary has emphasised the so-called voluntary principle, but my understanding of "voluntary", dating from Army experience of the voluntary church parade, is that it implies the opportunity to opt out, and this is what the Government seem to be disallowing. They have the other conception of volunteering, which in the Army was symbolised by, "You, you and you". Do they really believe in the voluntary principle—

Mr. Speaker

Order. That is a general question which might come on another occasion, but not on this one. The hon. Gentleman must address his remarks to whether retail prices shall be included or not.

Mr. Alison

I come back to the point, that the Government are taking quite unnecessary powers. They already have the main responsibility for increases which have taken place in retail prices recently. Judging by the leaked reports in the Daily Express, and our suspicion that they will seek to reject the Amend- ment, the Government appear to be trying to shift the odium for retail price increases from where it belongs, which is in their own court, on to the unfortunate shopkeeper who is the last soldier in the rank in respect of all the pressures which built up earlier in the line as a result of increased prices.

As my hon. Friend the Member for St. Ives (Mr. Nott) pointed out, over half of the 2½ per cent. increase in the Index should be laid at the door of the Government as a result of Purchase Tax, Selective Employment Tax and the recent increase in petrol prices, and the 2s. in the pound increase in electricity charges will also be passed on. How will the right hon. Gentleman disentangle all these things when he examines retail prices? All he is doing is shifting the odium on to the retailer, who has to digest the varied increases which the Government generate. How will blame and praise be apportioned? Once an unfortunate retailer is to be examined by the "ghost squad", his reputation will be lost.

Mr. Peyton

I wonder whether my hon. Friend has any evidence for supposing that the squad will be a ghost squad? I should wholly welcome that.

Mr. Alison

The "ghost squad" is an effective arm of Scotland Yard. If that connotation is to apply, the squad will probably be only too effective if it is used by the Government. As I say, odium will be cast on the unfortunate retailer, and this will be largely the responsibility of the Government.

Mr. Laurence Pavitt (Willesden, West)

Is the hon. Gentleman saying that the one person at whom the Government must not look to keep prices down is the retailer?

Mr. Alison

No, I am saying that they must not adopt this system of the ghost squad, the connotation which they apparently leaked to the Press, as the system which they propose to introduce to discharge the so-called voluntary aspect of prices and incomes. Apparently they are to send people round to scrutinise prices in the shops and hold them up to public scrutiny. This is not in the White Paper, but it has been publicly leaked to the Press by the Government. It is monstrously unfair.

The extra cost of electricity may be a factor which may be allowed under the recent White Paper as a legitimate reason for increased prices, but one thing is not clear. The proposed increases in electricity charges will come into effect in September and will amount to 2s. in the pound, and they will have an immediate effect on retailers already hard hit by Selective Employment Tax. But electricity authorities are apparently to be allowed to increase their charges because of a back-log.

According to the Financial Times of 30th June, the Minister of Power, apparently in a private address to a meeting of the Parliamentary Labour Party, said: The Government had already delayed earlier price increases— for electricity— because of the incomes policy and now charges had to take account of the back-log.

Mr. Speaker

The hon. Gentleman cannot, on this Amendment, discuss the merits of the electricity charges. He can mention them, as he has done, but he cannot argue about them.

Mr. Alison

I will not argue about them, Mr. Speaker, but I should like to know whether the principle of taking up the back-log of increases in prices, which has been adduced by the Minister of Power to justify the price increases, will be allowed to ordinary retailers. If so, how will the Government decide where blame and praise really lie?

In this idea of an unofficial body going round snooping we see the danger of the reputations of individuals, firms and so on being tarnished through being selected for special treatment. They will be held out to the disapproval of the public because the Government are trying to shift the odium on to a section of the public which should not bear it. The greater part of the responsibility lies with the Government. The increases in retail prices are sometimes directly and in many cases indirectly the result of the Government's policies.

I have already mentioned the Selective Employment Tax and the increase in the cost of petrol, and so on. What about the increase in Purchase Tax for motor cars sending up the prices of secondhand motor vehicles or the secondhand market generally suffering increases in prices as a result of squeezes in other directions? Is this held to be undesirable? What about the price mechanism in housing? It may well be that the level of rents, particularly council house rents, can best be kept down by allowing increases in certain sectors.

Mr. Speaker

Order. The hon. Gentleman must not let his enthusiasm carry him away. We cannot discuss the whole of the Government's policy on this Amendment.

Mr. Alison

My enthusiasm, Mr. Speaker, is entirely for the Amendment and in no way for the Government's proposals in the Bill.

The First Secretary has done what appears to me to be an ungenerous and uncharacteristic trick in putting forward in the newspapers the idea of a ghost squad. I hope that he will come clean about this and recognise that the greater part of the price increases which we have suffered is his own responsibility and will stop the policy of snooping and innuendo, which seems to be such a part of the Government's policies.

The Chancellor of the Duchy of Lancaster (Mr. Frederick Lee)

The hon. Member for Barkston Ash (Mr. Alison) was apparently very worried about the Government accepting odium. His argument about the effect on prices of Government policies has always been accepted on these benches. Indeed, we have been sneered at from the other side for accepting what he calls odium. It is true that of the very small increases which have taken place in the retail index a considerable part is due to policies of the Government which were necessary because of the critical situation in July. We do not in any way disagree that we were responsible for a goodly portion of the 2½ per cent. increase in the retail index which has taken place in the last nine months.

So that we may put the matter in its correct perspective, let us take another critical nine-month period, that to which was given the term "the Selwyn Lloyd freeze", when retail prices increased by 4½ per cent. instead of 2½ per cent. Perhaps by this means we can get the relative accomplishments of the two parties in their right perspective.

Under Part II of the 1966 Act, a temporary standstill under Section 7 (3,b) or Section 8(2) can be imposed on increases in manufacturers', wholesalers', or retailers' prices. If we accepted the Amendment it would mean that retail prices would be completely excluded from our purview.

I was asked questions by a number of hon. Gentlemen about ghosts or commandos and matters of that sort. I, too, read in the newspapers that the Government were thinking in terms of getting together a squad of people to investigate retail prices over a wide area. It is entirely untrue that the Government have made any such arrangements. What we have discussed is that, when there is a concentration of complaints about a particular price increase—when we are receiving well over the average number of complaints—we would think it right to have a close look at that price.

That is a very different matter from what the hon. Member for Yeovil (Mr. Peyton) was talking about. We appreciate that, in a nation in which there are 2 or 3 million price movements a year, one cannot possibly have a huge squad of people going round supervising every price. Nor would the Government attempt such a thing.

4.30 p.m.

Mr. Peyton

I want to get the record straight. I did not initiate the reference to a "ghost squad". It was my hon. Friend the Member for Barkston Ash (Mr. Alison) who referred to it for the first time. I expressed the pious hope that it would consist only of ghosts because disembodied spooks would do less harm whereas a heavy-footed squad sent round by the Government would cause a lot of alarm and confusion.

Mr. Lee

There will be neither heavy-footed gentlemen sent round by my right hon. Friend or by me nor the ghosts of Christmas past, present or future. I have explained what it is we have discussed and it is not the grandiose statement which appeared in the Press.

This debate has been interesting. The hon. Member for St. Ives (Mr. Nott) told us that there had been a remarkable stabilisation of retail prices—he suggested that it was such a great success story that there was no need for us to have any kind of control at all. That was a true chronicle from the Conservative Party of the events of the last 12 months and I accept it entirely.

My hon. Friend the Member for Penistone (Mr. Mendelson) rightly asked whether we believe that, arising from this new legislation, we could achieve success similar to that which, quite rightly, the hon. Member for St. Ives congratulated the Government on achieving during the last 12 months.

Mr. Mendelson

As my right hon. Friend is enjoying himself, I ask him to remember that if he goes on for years to come to use the praise of hon. Members opposite, but fails to get ours, it might put him in a queer position one day.

Mr. Lee

I am speaking in the knowledge that the vast majority of my right hon. and hon. Friends support me, even if two or three do not, on this point, find themselves able to do so. The same apparently obtains on the benches opposite.

We are fortified by our success and now that we have proved our case by facts and figures we believe that we can bring about not what hon. Members opposite have described as further restrictions—an odd choice of phrase, since the Bill is much less restrictive—but something far more constructive in its approach to the prices and incomes policy. I do not think that we should be too despondent and talk in terms of restriction rather than of a constructive approach.

If we continue as we intend to continue, supervising manufacture and wholesale prices—which, in any case, is a responsibility of Government Departments quite apart from the prices and incomes policy—and achieve success, gaining improvements in manufacturing and wholesaling methods, it would be unfair if retailers were able to cream off the results of improvements in efficiency of manufacturers and wholesalers.

There has been one occasion on which the Government asked the Prices and Incomes Board to look at a retail price and I would have thought that, on a day like this, it would commend itself to hon. Members. In its Report on Costs, Prices and Profits in the Brewing Industry— Command Paper No. 2965—the Board made recommendations about the retail price of beer charged in public bars and recommended that, with some exceptions, there should be a standstill of from six to nine months. Surely that was an achievement worth having. It may well be that we shall require on future occasions specific power to look at retail margins and it would be wrong for us to rob ourselves of the ability to do so.

My hon. and learned Friend the Member for Northampton (Mr. Paget) argued that we should retain resale price maintenance. It was not the Labour Party which introduced the Resale Prices Act although, in fairness, I should say I believe that we are now beginning to benefit from it. I believe that, in some directions, there is, in the retail trade, more competition than there would have been without the Act.

Mr. Deputy Speaker (Mr. Sydney Irving)

Order. I understand that Mr. Speaker intervened to keep the debate to the Amendment, which is that retail prices should be exempt from any standstill after the pause. I find it difficult to believe that the Resale Prices Act comes within the provisions of the Amendment.

Mr. Lee

With respect, Mr. Deputy Speaker, I would have thought that I was no, far off. I was arguing that the Act had had a beneficial effect on retail prices. However, I shall not continue that line.

Mr. Paget

On a point of order, Mr. Deputy Speaker. It was I who raised this subject when Mr. Speaker was in the Chair. The argument I was putting then was that one would never successfully control prices except through the manufacturer or supplier and that one could only do that through some form of price agreement between the manufacturer and the retailer. I thought that that was in order and I think that Mr. Speaker also thought it was.

Mr. Deputy Speaker

I would not be too happy to pronounce upon that now because my feeling is that the argument is, nevertheless, a little wide of the Amendment. However, as the Chancellor of the Duchy of Lancaster is going on to some other subject, I will not press the point.

Mr. Lee

I have practically finished the argument I wish to deploy, Mr. Deputy Speaker.

I believe that it is essential to retain these powers. The debate has been helpful in informing the country of the success we have achieved. I know that some of my hon. Friends still believe that greater success could have been achieved in some other way. I have said that this is a huge operation and that no Government in a democratic society ever could hope to set up a mechanism which could control every retail price movement. Nor would we attempt to do so.

I have argued that other events have brought extraordinary pressures to bear and the stability of the retail price index, in spite of these pressures, has shown that our policies are succeeding. This is not now a matter of theoretical argument about what may or may not happen a few years from now: we have already achieved great success in this respect. Especially among low-paid people the steadying influence of our policies on the cost of living have been of great value. When one looks at the backlog of other issues which produced the pressures which we had to counterbalance by our legislation, I believe that we are entitled to expect that the House will support us in retaining the powers which we now have.

Mr. Iain Macleod (Enfield, West)

If the Chancellor of the Duchy believes his peroration, he will believe anything.

I was disappointed that the right hon. Gentleman rose so early in the debate—we have hardly started it yet. It is only in the interests of tidy debate that I follow him, although I hope that other Members will continue this most important point.

The Chancellor of the Duchy went on to move a vote of thanks to my hon. Friend the Member for St. Ives (Mr. Nott) because, whatever alliances may be formed in the course of the evening, or night, he has succeeded in uniting the other side on an issue concerning prices and incomes—a very remarkable achievement indeed.

I would like to support the Amendment by an illustration from the particular before I move to the general. My experience of constituents has been somewhere between that of the hon. Member for Penistone (Mr. Mendelson) and that of my hon. Friend the Member for Truro (Mr. Geoffrey Wilson). I have not had anything like 100 letters, but I have had some. I agree with the hon. Member for Penistone, on the issue of retail prices, that the public can judge, but I go on to draw the conclusion that because that is so we do not need the provision that is in the Bill and we should support the Amendment.

The particular instance that I give—I dare say other Members could match it from their own correspondence, but it illustrates the deep waters that we are in when we try to contemplate power over retail prices—came to me from a woman constituent who is obviously extremely intelligent and persistent. The facts are that after a period of severe restraint a world-famous brand name on a toilet preparation changed from a plastic to a glass container, and to pay for the additional cost it reduced the amount from 35 grammes to 25 grammes. The retail cost remained the same, but there was a substantial increase in price because of the reduction in content, leaving aside the merits about whether the container is or is not an improvement.

My constituent wrote to me, to the Consumer Council, to the firm and to the Board of Trade. To the firm she said that she preferred the old plastic container to the glass, because it was easier for travelling, and that the cost, taking into account the reduction in content, was too much and that she would no longer buy that particular brand. That action by her was exactly right, because that is the operation of the market. If her opinion is the right opinion on this particular retail price and if all the other people in the country who buy this preparation took the same action, the firm would "go broke". That again is the operation of the market.

However, there is the other side. The firm does not make these changes because there is an "r" in the month or to have fun. In this case, the firm went in for extensive market research and its view was that the container and the new improved system, which we are so used to hearing on television, was an improve- ment. If the firm is right then people will buy it and the firm will prosper and that is as it should be.

In other words, on this particular retail price—and hon. Members could no doubt duplicate this from their own correspondence over and over again—the position of my constituent in complaining and refusing to buy the product is absolutely right. The action of the firm is for the future, because this is a matter of supply and demand and the way the market works. The firm thinks it is right and my constituent thinks it is wrong. No doubt we shall see.

4.45 p.m.

But it is nothing to do with the Board of Trade to whom this matter was in due course referred, and because we do not believe that these matters have anything to do with a Government Department we seek to move the Amendment and take retail prices out of the Bill.

As a consequence of this short episode that I have related, my constituent is very indignant. Think of it in terms of any other retail price. Suppose that she goes to buy a dress. If she finds that the length of the skirt, the material of the dress and the cut of the dress are prescribed by a Government Department, she would be very angry. Such things are only tolerable in wartime, if at all, but there is no essential difference between the two. In neither case has a Government Department any standing in the matter. This is a real difference between the two sides of the House.

I said on Second Reading that in relation to prices the back bench supporters of the Government were being conned—I believe that is the right word—and some of them liked it. Some of them want to feel that this power is there, even though they and the Chancellor of the Duchy and the First Secretary and the rest of the Front Bench know perfectly well that it is a bluff. It is not possible to control prices, whether you try and do it by diktat or by reference to Aubrey Jones or in any other way.

This is party because what emerges as a retail price, perhaps in the food sector, the most important of all, is affected more than anything else by the weather, and even Governments cannot prescribe that. In all the other range of retail prices such matters as design, fashion and packing an a hundred other things come in all the time. It is, therefore, impossible—and if the Press reports are right, this has been put by Mr. George Woodcock and others to meetings of the party opposite—to contemplate a Government having any serious impact on the issue of retail prices.

We have in the White Paper on Prices and Incomes Policy After 30th June, 1967, the philosophy of the Government which leads them to say that they need this particular power. In paragraph 2—this is a contradiction which was referred to in Committee by the hon. Member for Worthing (Mr. Higgins)—they say that the July measures have eliminated the excess pressure of demand…". In paragraph 6 they say: …the aim must be to avoid any widespread and unjustifiable increases in prices due to pressures which may have been building up…". Whether paragraph 2 or paragraph 6 is right, they cannot be right together. The Chancellor of the Duchy made no attempt in his rather light hearted comment on what had happened since last July to justify this point.

The aim in relation to prices is at the end of paragraph 7, …the aim will he to concentrate on those prices which are of economic significance, including those of importance in the cost of living. I do not understand, and the Chancellor of the Duchy did not explain, what prices are of economic significance. The only example on which the Government have moved is laundry prices. We know why they did that. They had about 300 letters and they panicked and brought in an Order. I think that the Director-General of the C.B.I. said that industrialists felt betrayed by what had happened. Since then we have heard no more about it.

The answer which the Chancellor of the Duchy was touching on and which the First Secretary gave in Committee was that one must not measure the success—that was the word—of this policy by the number of Orders. The Chancellor of the Duchy said that he had been fortified by the success of the policy since last July. What success in relation to retail prices? The Chancellor of the Duchy of Lancaster produced one year, and he saw me looking at him and quickly passed over that example. I know how Ministers get briefed—it took a long time to find that year.

It is perfectly true that there is another, but in the record of the last 10 years on seven occasions the retail price index went up by less, so that the Government's performance is worse than in those years, whereas in two years, one of which has been quoted, it is better. That is all that the Government can claim in 10 years. One example was quoted; no doubt the other will be quoted to us in due course.

Mr. Frederick Lee

Does not the right hon. Gentleman recall that his hon. Friend the Member for Yeovil (Mr. Peyton) informed him that from April, 1963 to 1966 the retail price index went up 11½ per cent. and incomes 25 per cent.?

Mr. Macleod

That does not alter my argument in the least. As the right hon. Gentleman will remember, the average amount of 22 per cent., in a period which is seasonally favourable all the time, compares very badly with almost every Tory year, with the two exceptions which I have given.

There has been no success whatever with retail prices since last July. The Chancellor of the Duchy gave the lie, as it were, to what my hon. Friends have been saying about the commando squads. These were reported in the Daily Express of Wednesday, 5th July as being squads to do on-the-spot prices checks. It was the main story and I should have thought that it was a bit late to deny it now. If it were untrue, a denial should have been issued straightaway. After all, the Leader of the House has just issued a denial this afternoon of the speech which he made last Saturday and which I have not the slightest doubt was accurately reported by the Press Association. Perhaps in the course of the night another opportunity will occur to come back to that.

There is no doubt that the word used by my hon. Friend the Member for Yeovil (Mr. Peyton) and others was right and that this policy is a mess. There can be no doubt that the Government have had no success with retail prices. There can be no doubt that they do not intend to make a move about retail prices, except from time to time to hurl a bone to the wolves when the wolves behind them begin to snap a little too near the Government's sledge.

The right thing to do, therefore, is to accept the Amendment and to leave retail prices out of the operation of Clause 1. We should join together and free retail prices from interference by the Government, because that interference is bound to be ineffective if tried and has been shown to be ineffective every time it has been tried.

Mr. Pavitt

The right hon. Member for Enfield, West (Mr. Iain Macleod) began his speech by agreeing with my hon. Friend the Member for Penistone (Mr. Mendelson). I am pleased to be able to tell the House that I agree with the opening remarks of both speeches. However, I notice that the right hon Gentleman quickly parted company from my hon. Friend and drew a very different conclusion from the same facts. That is not the first time that that has happened in the House.

The right hon. Gentleman made much of the fact that our constituents are knowledgeable about retail prices. Housewives, naturally, know more about retail prices than most male hon. Members do, but it is precisely because of the inability to do much about it that the Government need powers to lend support when and where that is necessary. That is precisely the purpose of the Clause which the right hon. Gentleman and his hon. Friends seek to amend.

It is somewhat 19th-century economics to think that the consumer has sovereign control over retail prices because of his ability to buy or not to buy. What happens these days, as everyone knows, is that the consumer is on the sticky end of the wicket of large-scale promotion. It is promotion and production and the way in which things are sold which produce the market, and it is, therefore, essential that the Government should have some say if our constituents are to be protected.

The right hon. Gentleman gave a classic example and almost destroyed his own case in the next sentence. He spoke of a proprietary preparation whose quantity and container had been changed. Unless the Government are able to keep charge of that kind of thing, the consumer is unable to do so. It was the right hon. Gentleman's party which brought in legislation dealing with retail prices and it was the Leader of the Opposition himself, against a good deal of advice from his colleagues, who tried to end resale price maintenance.

The right hon. Gentleman said that Government Departments could not interfere, but it was right hon. Gentlemen opposite who introduced the Weights and Measures (No. 1) Bill, about which we had much discussion before it fell, and which they followed with the Weights and Measures (No. 2) Bill, which dealt with retail prices of various kinds of commodities so that consumers could be protected. The right hon. Gentleman is usually logical and clear, but on this occasion he was a little ambiguous and I found him destroying his own argument in his own speech.

Mr. Iain Macleod

I do not mind what the hon. Gentleman says about my speech, but will he make his own a little clearer? Does he suggest that the Government—and this is the only conclusion one can draw from what the hon. Gentleman is saying—should have powers to lay down what shape, size and material a container should be made of?

Mr. Pavitt

I am too old a bird to be caught by that one. The right hon. Gentleman is trying to draw me far wide of the Amendment and the Clause. I should be out of order if I started to say how far the Government should use its influence in these respects, and the right hon. Gentleman knows that as well as I do.

It is a classic red herring to argue that it is regimentation if it is provided that the retail price of biscuits, for example, shall be based on an 8 oz. packet and not on a 6¾ oz. packet. Most people would sooner be able to buy a clear package which was clearly understood with its contents printed on it in large and not small print so that they could know precisely what kind of retail price they were paying.

It is absolute nonsense to think that we can do anything about prices if we differentiate between prices of production, prices of wholesaling and retail prices. We cannot deal with prices as though they are three separate items, which is what the Amendment seeks to do. We have to recognise that what hon. Gentlemen opposite are saying is that they do riot like the Clause at all, which is honest enough, but the Amendment does nothing to protect the consumer which, I hope, is the desire of hon. Members opposite.

Mr. David Webster (Weston-super-Mare)

Is not the hon. Gentleman aware that on page 13 of the Prices and Incomes Board Report No. 13 on the Brewing Industry, that industry is divided between production, distribution and retailing, and that each is treated completely separately?

Mr. Pavitt

I should be very surprised if the Ministry concerned—the Department of Economic Affairs, the Board of Trade or the Ministry of Agriculture —which would have a wide interest in each was not able to apply an interest to each. Surely that is the whole purpose of the Bill.

The only way in which we can show that we want to make sense of prices, productivity and income is to take power to deal with prices. I agree with my hon. Friend the Member for Penistone that prices are more or less the key to a number of the other problems which we face. If we are to deal with prices, we must include the tail end, which is the retail price the consumer has to pay. The right hon. Gentleman said that this is a bluff, that we cannot do everything about the 3,000 different prices, and that every price increase cannot be looked at. I accept this, but what the Government have been doing over the last 12 months, and what they are doing now, is to show that by using their influence appropriately from time to time they can keep the lid on the runaway of prices which occurred during the 10 years before the change of Government in 1964.

I hope that the House will reject the Amendment, because if it were accepted it would make nonsense of the Clause. I am sure that hon. Gentlemen opposite are as keen as anybody else to protect consumers, in spite of the fact that the hon. Member for Barkston Ash (Mr. Alison) was more concerned with the shopkeeper than with shoppers.

5.0 p.m.

Mr. David Howell (Guildford)

May I, as a member of the Committee which considered the Bill upstairs, extend a welcome to the hon. Member for Penistone (Mr. Mendelson) and his hon. Friends to our deliberations at this stage. They were, at times, sorely missed.

I must break the harmony which seems to be growing between us on the question of retail prices, because the hon. Member for Penistone asserted that housewives were capable of judging when prices had moved upwards. I straight away disagree with that statement by asserting that this is not always so. In fact, in many cases it is not so, and the reason for this is that very often the price does not move. A housewife does not know when she is paying the same amount for less.

We have just heard the hon. Member for Willesden, West (Mr. Pavitt) saying, in effect, that these changes in quality or content should somehow be policed. He wants observations of a detailed kind, not merely for prices—which admittedly one constituent of my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) was quick enough to spot, a change from plastic to glass, and a change in content—but changes in packaging or content which many housewives do not spot as they hurry through the supermarkets.

I have the support of no less a person than the Chairman of the Institute of Weights and Measures Administration who is reported as saying at the end of June that there were 492 varieties of biscuits produced by 23 manufacturers, and that these packages were being changed all the time. He went on to ask, according to the newspaper report: How can the purchasing public compare values and prices when this practice is adopted? The hon. Member for Willesden, West would like a team of people out on the job checking these 492 varieties and 23 manufacturers' operations weekly, or as often as they changed their packages. This is the kind of price control which he would like to see. It would be extremely costly in manpower. I suppose that it would be possible, but at the end of the time I am sure that many of the people would never look another biscuit in the face. This is the kind of variety and price change that is going on all the time.

That leads me to the central question which my right hon. Friend the Member for Enfield, West raised, namely, if a proper system of retail price control is to to be operated how is one to take account of quality? The number of price movements concealed in quality and packaging changes is legion. These are price movements which affect housewives in many ways, and which will not be controlled by these powers, or by any other measures which the Government bring in. It is only when the housewife gets back home that she realises that her money has not gone as far as it did previously. These are concealed price increases, and the Government's power to control retail prices do not affect these. I come back to the Chairman of the Institute of Weights and Measures Administration, who reportedly said that there was an even more bewildering picture in soap powders, liquid and powdered detergents, and a whole range of packaged goods in the supermarkets and groceries.

This picture is wildly different from the picture of success painted by the Chancellor of the Duchy of Lancaster, who, a short while ago, was in a mood to take a lot of credit for the success which had been achieved. I thought that he was going to take so much credit that he would overburden himself.

The right hon. Gentleman said that my hon. Friend the Member for St. Ives (Mr. Nott) had congratulated the Government. I listened to my hon. Friend's speech, and I heard nothing of congratulation in it. What I heard my hon. Friend argue was that during the last year, when unemployment had risen, when there had been the most vicious credit squeeze for many years, when there had been strict credit restrictions, and when we had begun to see the effects of the Measure passed by my right hon. Friend the Member for Bexley (Mr. Heath) for the abolition of resale price maintenance—the discussion of which has been ruled out of order, but it has had some effect in keeping down prices—and when there had been a favourable move in commodity prices, retail prices had nevertheless risen by 2½ per cent. This is the fantastic figure which requires no congratulations, and certainly provides no excuse for taking any kind of credit.

It means that over the measurable area of retail prices, prices have increased, as any housewife can tell the right hon. Gentleman, and that over the vast area where the price itself has not moved, but the quality has,—there is one less biscuit in the pack, or half an ounce less detergent in the pack—here, too, real price increases have taken place. This is where the Government have no control, and this is why their policies for price control have not worked, are not working, and will not work, and why other, more sensible, and effective measures are needed.

Mr. Norman Atkinson (Tottenham)

I am sorry that the right hon. Member for Enfield, West (Mr. Iain Macleod) has disappeared, because I wanted to talk to him, and to one or two other hon. Members as well. I am sorry, too, that the right hon. Gentleman has got mixed up in the rather squalid grocers' revolt which seems to be going on on the benches opposite, because he is something of a giant among the many intellectual pygmies that there seem to be in the Conservative Central Office when it comes to dealing with economic affairs.

The interesting thing about the debate is not what has been said about the whole question of retail prices, but that for the first time we have had a Front Bench spokesman from the party opposite asserting very clearly, in his support for the Amendment, that his party does not support the idea of controlling retail prices. They have said on other occasions that they cannot support the idea of industrial price control, so if we put the two together they are on record for the first time as saying that price control is not only impossible, but undesirable.

Mr. David Howell

Before he reads that conclusion into his personal record, may I tell him that simply because the Government's present methods have failed to keep down prices are wrong, this does not mean that we do not advocate—and past Conservative Administrations have advocated—legislation to affect the level of prices. The abolition of resale price maintenance is a classic example of this, for which credit is being claimed by the Chancellor of the Duchy of Lancaster.

Mr. Atkinson

I am grateful for that intervention, because it illustrates the problems of the party opposite. I am not quoting the minnows of the Conservative Party, but the right hon. Member for Enfield, West, who said quite categorically this afternoon that retail price controls are impossible and undesirable, and he supports the Amendment. It has been submitted to the House because the party opposite is arguing that retail price control is impossible.

Mr. Terence L. Higgins (Worthing)

In the absence of my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), I would like to make it clear that we are not saying that it is impossible to control the general level of prices, but that it is the individual price which we feel it is impossible to control.

Mr. Atkinson

That is a rather curious statement. I am trying to clarify the situation. I can understand the view of the party opposite, because once we start to interfere with the price mechanism of organisations, we start to interfere with those who sponsor the membership or hon. Gentlemen opposite—[HON. MEMBERS: "Rubbish"] It is true. Not long ago the Chancellor of the Exchequer said that when he looked at hon. Gentlemen opposite he saw vacant faces, but he also saw the interests of X Y and Z represented by those vacant faces.

Mr. Kenneth Lewis (Rutland and Stamford)

Is the hon. Gentleman prepared to bet that there are fewer hon. Members on this side sponsored by any organisation, least of all by retail organisations, than there are Members on the benches opposite sponsored by the co-operative society?

Mr. Deputy Speaker

Order. Both hon. Members are getting wide of the Amendment.

Mr. Atkinson

We must get this clear. I noticed from the nods of my right hon. Friends on the Front Bench that it was in their own hearing that a responsible spokesman of the party opposite said that retail price control was not possible or desirable and, therefore, that hon. Members opposite were supporting the Amendment to remove retail price con- trol from the Bill. That is a fair assessment of the situation.

It is important to get the record right. The party opposite has shown itself to be clearly opposed to the idea of price controls. It was a pity that, over the weekend—between the squalls of yachting experience—the Leader of the Opposition could not have fitted into his statement of policy the argument that one of the facets of Tory policy in respect of economic management must be that retail price controls and industrial price controls are impossible.

That was the case made by the hon. Member for St. Ives (Mr. Nott). He seeks to delete certain words because, he says, the whole theory of price regulation is an impossibility. Many of my hon. Friends have advanced the case for a price regulation or price licensing system. I do not want to stray beyond the guide lines of order. I shall stick strictly to the question of retail prices.

Together with some of my hon. Friends I have argued that a policy to control retail prices can be successfully carried out by licensing retail outlets. That is the whole case for the policy of wage restraint and wage freeze. We have said that it is possible—with our curious mixed economy—to have a system of price licensing if retail outlets are licensed. We have based our case upon our experience with similar retail outlets which are licensed, or where there is some degree of control, as in the case of the Post Office and the licensing trade. It is possible for the Government to license all the retail outlets. The hon. Member for St. Ives is not correct in saying that retail price licensing is not possible.

That is not to say that my right hon. Friend and the Government have been desirous of carrying out price control, because they have not made any attempt They have decided that economic management can best be carried out by allowing some increase in retail prices. Therefore, they have not wanted seriously to intervene to keep prices down. They have deliberately stimulated price increases to bring about a degree of deflation, and that has caused some criticism from this side of the House.

I want to take up one point made by the Chancellor of the Duchy of Lancaster. He claimed that we did have price control in the licensing trade. I do not know whether it is commonly known, but that is a bogus claim, because the only price regulation that the Government have is in respect of bar prices. Only in the public bar is any control possible. The publican or manager of a licensed house can charge what he likes anywhere but in the public bar.

That is what has generally been done, and that has been the cause of hundreds of letters being sent to hon. Members on this side of the House by constituents who complain that prices have risen in hotels and public houses because the manager or tenant is allowed to charge whatever price he likes other than in the public bar. In these days the public bar is often about the size of a telephone kiosk. The licensing trade has not been placed in much difficulty in this matter.

For some time there has been a system of price regulation under which merchants must inform the Government of any intention to impose a price increase on any item that is sold. He is obliged to inform the Government that the price of jam, for example, will rise by 1½d. next week, and he is then barred from imposing that increase for 30 days, unless permission is forthcoming.

All that my hon. Friends and I are arguing is that every retail outlet, of whatever kind, should be licensed. Just in the case of a dog licence, if firms do not conform to the needs of the time they should lose their licence. We must have some such system of licensing. I do not disagree about the impracticability of controlling every luxury commodity. We have no quarrel on that score. It is possible to regulate prices in this detailed way. Our general thesis is that it is possible to have a licensing system such as that which applies to the Post Office and other licensed retail outlets.

Far from shying from the question of intervention, we hope that the Government will come to grips with the problem, not only in resisting the Amendment but in going much further by pursuing a policy which enables us to have some price control, therefore encouraging the T.U.C. and other people to attempt voluntarily to carry out a wages policy.

5.15 p.m.

Sir Douglas Glover (Ormskirk)

The hon. Member for Tottenham (Mr. Atkinson) talked about this form of licensing being like a dog licence, and said that a firm might have to lose its licence because it made a large profit through efficiency or made a loss through being inefficient. It is not the case that the firm which makes the smallest profit, on a footage basis, is less efficient than a smaller firm selling at higher prices and so making a higher profit, and working within the Government system.

Mr. Atkinson

I argued in this way because it has been suggested by hon. Members opposite that we wanted teams of snoopers going round the country looking for price increases. It is nothing of the kind. We have said that the onus rests upon the retail supplier to notify the Government. Apart from that, the people themselves would test the case for the continuance of the licence, and would judge whether the retailer had trespassed beyond the prices which they had considered to be reasonable.

Mr. Deputy Speaker

Just as I had to intervene on the question of retail price maintenance, I must intervene now to point out that we cannot have a detailed discussion about alternatives. That is what we are in danger of doing on this question of licensing.

Sir D. Glover

As the hon. Member for Tottenham has taken about five minutes over his intervention, perhaps I may reply. What he has suggested is completely unworkable. It would be a bonus for inefficiency and not for efficiency. Not even the Chancellor of the Duchy of Lancaster would be very enarmoured of his hon. Friend's argument.

It is on the question of retail prices and not manufacturing prices that I maintain, after a lifetime's experience, that the Government's suggestion is completely unworkable. For many years, I have run retail shops and been in the wholesale business and I am familiar with many commodities. I do not say that a retailer might not sometimes make an exorbitant profit on some commodities, makes losses on other commodities, and so would be a fool if he did not. If he makes a good buy, he will make a profit, but with a bad one it will be a loss and he has to balance the two. An enormous amount of trade is done on prices which they know that the public want to pay.

My clothing business had an enormous reputation for the best value in a jumper at £1, or 19s. 11d. This had to cover an enormous number of price increases. If the price of wool went up, the weight of the garment was reduced, but if it went down, we gave better value. At that price, we covered an enormous amount of reductions in the quality of the garment. We offered manufacturers a large contract. If the wool market was unfavourable or wages rose, we had to consider that, but we want to give the best value at £1 and we succeeded.

Suppose there were statutory control or retail prices in the clothing business. In one year, men's cardigans are 22 in. long, and in the next might be 24, and the price rises because there is another 2 oz. of wool in the garment—

Mr. Frederick Lee

Would the hon. Gentleman not agree that skirts nowadays should cost about 6d. each on that theory?

Sir D. Glover

I agree, and women's dresses today are far cheaper than five years ago. If dress prices are controlled statutorily next year and fashions change and girls wear about four and a half yards of material, those calculations will be round the bend, and will be worked out only when the fashions change, because it will take months—

Mr. Webster

In one of the best sections of the London export business, how would my hon. Friend envisage these controls in Carnaby Street, for instance?

Sir D. Glover

Exactly. No sensible group of people could decide on the price of half the things in Carnaby Street. They have recently been selling secondhand guardsmen's tunics which they probably bought for a shilling each and of which they put up the price when they discovered the enormous demand. After all, there were only so many such tunics available, and they made a good profit out of what was available. Next year, it may be something else, but it will take the Board of Trade 12 months to work out these things and they will be behind the times all the time.

The same applies to food. The average greengrocer knows that, in June, he will sell X pounds of tomatoes. If there is bad weather, and tomatoes are scarce, he will sell about the same quantity, provided that they do not exceed a certain price. If there is a glut, he sells roughly the same quantity, because each household cannot eat three times as many just because they are cheap. When the price is low, his margin is higher and vice versa. That seems a contradiction in terms, but he must get so much profit per pound because his sale is much more static on the number of pounds he sells than on the cash turnover. When the price is low, he wants a big mark up, and when it is high he does not need such a high one.

When a market changes almost hourly, how could any Government work out a price control system? This applies not only to tomatoes and greengrocery, but to meat and to anything baked. Hon. Members who, like me, shop at the weekend for their families know that the price of scones cannot be regulated. Would every one have to be weighed? Every housewife knows that they are only pinches of dough put into an oven, and even machine-made scones must vary in weight by up to 20 per cent. There is an enormous give and take in much retail distribution and there is bound to be.

If someone has a bad tomato in a pound bag, that is not a deliberate Machiavellian act by the retailer, who only picked out half a dozen. I might be the next customer and get five good ones in my bag. Hon. Members opposite seem to have forgotten that we are talking about controlling retail prices and not about the electricity increases, which the right hon. Gentleman did not mention, although his constituency and mine will face 15 per cent. increase. This is something which the Government should inquire into, because it is the production end.

On the retail end, a long lifetime of experience convinces me that it would be impossible, without laying down standards like those of the utility scheme during the war, that only certain things should be made if prices are to be controlled. Do hon. Members opposite, in a growing modern economy, want to start stipulating what will be made or sold? There is always a changing of fashion, habits and tastes. Even a biscuit manufacturer, with all his vast variety, tries a new biscuit or a new make-up of biscuits. No doubt he first sells it cheaply because he is trying to tempt the public to buy. He may, therefore, be selling at cost. or below cost.

5.30 p.m.

But suppose that the biscuit becomes popular. If the manufacturer is to have a large amount of his manufacturing turnover in the biscuit, it is essential that he should get a proper profit on it. Perhaps in the first lot of biscuits there were seven in a packet. But having established the biscuit on the market he has to put it on the same level as all the other biscuits and, therefore, he puts six in a packet. One could say that one was being robbed, but a far better way of looking at the matter would be to think that previously one was being tempted with an extra biscuit to buy the biscuits and that this was the bonus. Now one is paying the proper price for it.

Even with all the vast amalgamations, there is still fierce competition in selling goods in the high streets of the country. Far more than Government exhortation or Government control, the thing which made me—and I am sure that this applies to every efficient retailer—study the question of sales was the competition from somebody across the road who was fighting me tooth and nail for my trade. There is no law of the Medes and Persians which says that a retailer stays in business if he does not provide what the public want. I do not accept that the public do not know what they are up to. Most people know perfectly well when the wool is being pulled over their eyes. They deliberately accept it in most cases.

Take the question of cosmetics. We have all got wives, daughters and girlfriends. Therefore, there is not one of us who has not heard a great deal of conversation about this matter. Women like articles to be wrapped in attractive packages. They may be told that one package does not contain as much as another package, but it may be a lot more attractive and look much nicer on the dressing table or when she takes it out of her handbag. She is perfectly well aware that the more attractive bottle does not contain as much scent or powder, but it looks very much nicer when she takes it out in front of the hon. Member for Tottenham (Mr. Atkinson).

There is very little about which the British woman does not know when she goes shopping. She is prepared to buy vegetables in a shop which she thinks is more reliable than another, although its prices may be higher. She realises that she will pay more in one shop than in another, but she knows that it is a more reliable shop and that its reliability outweighs any 1d. or 2d. which she might save by going elsewhere. Other people want to buy in the keenest possible market and they are not interested about service. Therefore, they go to a different shop.

Will those two shops have to sell their products at the same price? If so, we shall be depriving the public, first, of a great deal of satisfaction in shopping and, secondly, of their chance to get better quality and better service even if they have to pay more for it. A woman who buys a dress in a shop where there are bare wooden floors or linoleum expects to get a cheaper dress than the woman who goes to Harrods and walks on thick carpet. The woman who goes to Harrods expects that Harrods will have to work on a bigger margin.

Do both establishments, selling exactly the same merchandise, have to sell it at exactly the same price? If so, it will not be long before Harrods closes. If it did, would it be a good thing for the nation? That would remove a great deal of dignity from the nation. Not many overseas visitors would come here if many of the big stores closed. They cannot possibly compete purely on price. They compete on price, service, environment and all the other things which go to make up shopping.

To talk about statutory control of retail prices is a nonsense which should be opposed. In a free society, it is an impossibility.

Mr. David Winnick (Croydon, South)

The Conservative Party has consistently opposed intervention in the price mechanism and, therefore, this Amendment was to be expected. However, there is a contradiction in the argument of the Opposition. We have been preached at for the last hour or so about how wrong ii is to intervene in the price mechanism and we have been told that the Government should not consider it their responsibility to meddle in such matters. But hon. Members opposite have spoken about items which have risen in price in the last six months or year. Therefore, logically we should be arguing for tighter controls and not less control.

I see no reason to adopt this 19th century attitude, as my hon. Friend the Member for Willesden, West (Mr. Pavitt) described it, whereby one does not intervene in cases in which it is considered wrong to intervene. One of the reasons why I was willing to support and vote for the prices and incomes policy last year, with a great deal of hesitation, was that the Government said that it was not just a question of pegging incomes because of the economic situation but also of doing something about prices.

When I abstained last October, again with hesitation—no one likes abstaining against one's own Government—I did so because I felt that the Government had not taken enough action over prices. I should find it impossible to support any incomes policy if the Government were not willing to take the necessary action ever prices. That is absolutely essential.

One can make out a strong case for saying that, because of the economic situation and the economic difficulties, the Government must have these reserve powers for another year; but they must be combined with reserve powers on prices. If hon. Members opposite say that we have not been willing to use these powers very effectively on prices, I hope that my right hon. Friends on the Front Bench will take heed of those words and will recognise that there is a need for strong, effective action over prices and not just over incomes.

Time and again during the last few months my constituents, and, no doubt, the constituents of other hon. Members, have said that prices are going up. Rightly or wrongly, they thought that last year, as a result of the July measures, not only incomes but prices would be frozen. Perhaps this explains to a certain extent some of the reverses which we suffered earlier this year. I see no reason why we should not be perfectly frank about that. I have never said, and the Government have never said, that all prices would be frozen.

Sir D. Glover

The Selective Employment Tax alone will increase prices by 5 per cent. on what I would call the weekly shopping basket.

Mr. Winnick

I know about the problem of the Selective Employment Tax. The picture is not as one-sided as it is sometimes made out.

I had hoped that over the last year the Government would be more militant over prices. It is a disappointment that we have not had a success story on prices. But that does not mean that we should take out, as the Opposition would like us to do, any reference to retail prices in the Bill. We should be just as firm over prices as we are over incomes.

In a recent report published by the Ministry of Social Security, attention is drawn to the number of families living in great poverty and hardship. I raised this matter at Question Time today. A number of these families have husbands in full-time employment and it is obvious that many of these, who are earning low wages, will be adversely affected by the reserve powers in our incomes legislation.

One can argue that, because of the economic situation, it is necessary for the Government to take these reserve powers. However, what is to be the plight of these people, many of whom are earning less than £l5 a week, if they find that it is more difficult for them to get wage increases in the coming 12 months, but if prices continue to rise? I put this question to my hon. Friend the Parliamentary Secretary to the Ministry of Labour earlier. I now ask it of hon. Gentlemen opposite who support the Amendment, because if they are willing to delete this provision referring to retail prices, those who are living on very small incomes will be even worse off. On the one hand they will find it difficult to get a wage increase while, on the other, there will be no restraint over prices. This proves that the Amendment is a policy of sheer madness. If the Government are to be given reserve powers—and I appreciate that some of my hon. Friends are not agreed about that; I support the move because, rightly or wrongly, there is little alternative—it is essential that prices are included. Not only must we reject the Amendment—and I assure hon. Gentlemen opposite that, Left or Right wing, my hon. Friends and I are united over this one—I implore the Government to see, in the coming 12 months, that effective action is taken over prices. If we do not we will be penalising the very section of the community which sent us here and which the Labour Party came into existence to defend.

Mr. Webster

It is clear that there is a division between the two sides on this issue. The hon. Member for Tottenham (Mr. Atkinson) described supporters of the Amendment as being concerned in a "squalid grocers' revolt". He has a short political memory, although he was not here when we debated the resale price maintenance legislation. There was certainly nothing like a squalid grocers' revolt on that occasion. The remarks of hon. Gentlemen opposite on this issue show the clear division that exists between the parties on this subject.

My hon. Friends and I take the view that prices can be kept down by free competition and activities in the market place. Hon. Gentlemen opposite, on the other hand, want to control prices generally—and the hon. Member for Willesden, West (Mr. Pavitt) went so far as to show that he would control every aspect of prices, even to the extent of the wrappings, contents and quality of the articles inside, say, a box of cosmetics. This is rigid control going mad.

Mr. Pavitt

The hon. Gentleman is taking my remarks too far. He has put up a bogey merely to knock it down. I said the whole sphere of legislation needed looking into and required control, and I was referring to legislation passed by the present and former Governments.

Mr. Webster

It was only at the last moment of his remarks that the hon. Gentleman realised the full implications of what he had said. When my hon. Friends challenged him about his remarks, he tried to say "Oops!"—as though he had almost said, or perhaps had said, something that he should not have said. But it was too late. If attention had not been drawn to what he had said it might have been necessary for my hon. Friends to have gone through the OFFICIAL REPORT to ensure that there was nothing in his record which could be used as ammunition for the Conservative Party.

5.45 p.m.

In any case, I wish that the hon. Member for Tottenham would not use the word "squalid". He should be more generous to his political opponents. He should not refer to my hon. Friends and I being here at the beck and call of the producers of these articles. I hope that he was not implying that. I have taken the precaution of looking up the hon. Member for Tottenham in Dod's Parliamentary Companion—

Mr. Atkinson

Really?

Mr. Webster

Really, and I said "Dod's" and not "dogs". I was not going into any of the Prime Minister's statements about his supporters. I gather that the hon. Member for Tottenham is a sponsored trade union member of the A.E.U. I hope, therefore, that he will not accuse my hon. Friends of always having vested interests. I have no vested interest to declare on this subject.

Mr. Atkinson

I undoubtedly have a vested interest. It is on behalf of the working-class. I am a sponsored Member and I openly carry a banner to that effect. I want hon. Gentlemen opposite to declare their squalid interests.

Mr. Webster

The hon. Gentleman must not judge others so low. I assure him that there are others who are not as low as his imagination might lead him to believe.

I have no interest whatever in retailing and I am sure that my hon. Friend the Member for Ormskirk (Sir D. Glover), who gave us a fascinating insight into his vast knowledge of departmental stores and supermarkets, has no interest to declare, except a vast knowledge of the retailing section of the community. The activities of this section have done more to reduce prices for the housewife than any other section since 1951.

My hon. Friend the Member for Ormskirk showed what a great deal has been done by this section of retailing from the point of view of price and quality. He also spoke about Carnaby Street. I had hoped that, with his knowledge of military uniforms, he would have given us a little more than that fascinating vignette of the activities of Carnaby Street which, however frivolous they may be thought to be by hon. Gentlemen opposite, are bringing a great deal of foreign currency to this country.

Mr. Dan Jones (Burnley)

I, too, listened with great interest to the remarks of the hon. Member for Ormskirk (Sir D. Glover). I noticed that, despite the great strides made by the section of retailing to which he was referring, prices have not been prevented from rising since 1951.

Mr. Webster

If the hon. Gentleman studies the retail price indexes of the large multiple stores and supermarkets he, will see that, in those establishments where retailing has been taken to its most sophisticated point, price rises have been a great deal less than in other sections of the community. He will note the difference between their activities and those of the co-operative society, which did not see the development of the supermarket and the 4,000 square feet-type of store and which did not develop itself along those lines, no doubt because it operates by committee. It has not been able to pass on price reductions to its customers to the same extent as the large private retailer has been able to do.

Mr. Deputy Speaker

Order. I have tried not to interrupt the hon. Gentleman, but he is getting rather wide of the the Amendment.

Mr. Webster

I apologise, Mr. Deputy Speaker. I was doing my best to answer hen. Gentlemen opposite and, in my enthusiasm, rather got carried away.

My hon. Friend the Member for Ormskirk spoke at length about quality. It must be remembered that one can talk about petrol or chemical derivatives. One can discuss aromatics and make a distinction between various products. One can say, "These are new soapsuds" or, "This is a new petrol fluid". By saying that something is a new product, one can say that the price should be increased. That being so, who will check on these statements? Perhaps one might concentrate on the octane rating of petrol, though even this is subject to much doubt as between different octanes in Britain and the United States.

The hon. Member for Willesden, West said that it was not possible to differen- tiate between production and distribution, on the one hand, and between the various aspects of retailing, on the other. Has he read Report No. 13 of the Prices and Incomes Board, in which such a differentiation was made? He will see that the subject is divided right down the centre, in one case applying to the retail outlet and in the other checking on all other aspects.

My hon. Friend the Member for Yeovil (Mr. Peyton) talked about "spooky snoopers" who would have to check every aspect of this. This will cost the community more than it is likely to save. My right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) asked whether we had climate or weather. I have the honour to represent the finest strawberry-producing area in Britain. Cheddar strawberries are the finest to come to London, Birmingham, or elsewhere. I know perfectly well that this year the Cheddar strawberry growers—

Sir D. Glover

On a point of order, Mr. Deputy Speaker. Is an hon. Member allowed to advertise?

Mr. Webster

I will not follow my hon. Friend into the path of advertisement, but I hope that he will not join the hon. Member for Swindon (Mr. Francis Noel-Baker) in his disapproval of anything that is advertising and at the same time gives people pleasure.

The Cheddar strawberry growers were terrified in April that they would have a very bad year, and again in May, when the rain continued. Not only would there be a loss because of the reduced crop, but had they not been able to pass on an increase in prices through the retailing outlet the position would have been quite disastrous. Many of these people go in for direct selling. They sell these magnificent strawberries at the side of the road. This is carried out throughout the whole of the perishable foodstuffs side of the economy, and it shows the nonsense of what is being attempted now—

Mr. Pavitt

In talking of the retail price of strawberries, the hon. Gentleman will doubtless recall it was his Government that introduced sale by the punnet or by the lb, so the regulation of strawberry sales was introduced by a Conservative Government.

Mr. Webster

And a lot of strawberry growers very much welcome that fact, because they were known to be reputable and to be maintaining an adequate standard of quality. Let us maintain an adequate standard of quality but leave the price mechanism to operate for itself.

All these retailers have had a terrific battering since the present Prices and Incomes Act was passed twelve months ago. We are not allowed at this stage to talk at length of the Selective Employment Tax but it represents a very considerable amount of oncost. In addition, we have the abolition of investment allowances, a vast increase in the costs of distribution, a vast increase in the rate burden as a result of Government action, and the 15 per cent. increase in electricity charges. The hon. Member for Tottenham speaks of a squalid grocers' revolt, but he probably has in his constituency grocers who are very much in revolt, and shopkeepers who have made the economy efficient are getting very fed up. I hope that the Amendment will be carried.

Mr. F. A. Burden (Gillingham)

I listened with great interest to my hon. Friend the Member for Ormskirk (Sir D. Glover), who has a very considerable amount of experience of the retail side of trade. I, too, may claim to have a certain amount of experience. I am chairman of a group of wholesale textile companies, and we rely for our business on the activities of retailers. I am amazed at the Government's attitude. I do not think that they know what they are taking on. They do not have a clue. If they had, the First Secretary would be a very worried man.

I want to refer for a moment to the speech of the hon. Member for Croydon, South (Mr. Winnick), who said that the Conservative Party had, during the last year, very vigorously contested certain increases in prices. He admitted that price rises had taken place, but the position is that when we have a nationalised corporation controlling a certain section of the economy it is extremely easy to intervene on the subject of price.

It is the easiest thing in the world for the Government to intervene, to question, to check and to refer to the Prices and Incomes Board suggestions of increased electricity prices. It would be the easiest thing in the world for the Government to refer to the same Board increases in various railway prices and increases by other nationalised industries. But they do nothing of the sort. When it has been a question of nationalised industries asking for increases, the increases have been given straight away. There has been no question of referring those to the Prices and Incomes Board.

The Government say that there would be difficulty, but there is no real difficulty if there is the desire to act in that way. On the other hand, there is now the desire to impose price control over a vast number of retail articles, but the possibility of doing so will be enormously difficult—

Mr. Paget

This is an Amendment to take away a power that the Government have not used. They would not use it if they could, and they could not use it if they would. The real objection is that giving up these powers would be awkward because of trade union negotiations. Let us get down to reality.

Mr. Burden

I am reminded that in one area of the retail trade one member of the Government has condoned increased prices, during the last year. Let us take as an example the case of selling meals in railway hotels. I sent to the right hon. Lady the Minister of Transport a bill from the North-Eastern Railway Hotel which had been sent to me by one of my constituents because, at the bottom of the bill, was shown a levy of 2s. 6d. for Selective Employment Tax. The Minister wrote back to me and said, "It is perfectly all right. They have every right to pass this on."

That illustrates some of the difficulty in which the Government will find themselves, because if the railway hotels which sell food retail have the right to pass on to the public increased costs brought about by S.E.T., which is Government action, so, presumably, will the same caterers' prices reflect increases in electricity and other charges. I suggest that if the Minister is honest in saying that he intends to peg those prices, he will have one devil of a job in deciding how to do it.

Those of us in the retail or wholesale trade know only too well that many of the retailers have had a very difficult year, and that many of the smaller firms are on the brink of bankruptcy. I should like to ask the right hon. Gentleman, who talks of controlling retail prices, just how many bankruptcies of retail shops have taken place in the last year, and how many in the previous three, four or five years. He would be rather alarmed, I think, by the number. Does this indicate that they are doing extremely well out of the prices they are now charging?

Another difficulty is that of controlling the price, not of one article produced by one industry but a tremendous number of articles. My own firm wholesales at least 4,000 items. Let us take the case of a large store selling, perhaps, 20,000 articles, and let us suppose that there is another store along the street selling the same number. How does the right hon. Gentleman propose to act? Does he intend to send someone into the one store and check every price from time to time in that store, and then do the same in the other in order to see that one does net charge more than its rival, and that they do not increase their prices?

What about the supermarket that puts in a loss leader and sells it at a cut price? Is that cut price to be the standard price, the yardstick by which every price in the area is to be judged? What about the shop, cited by my hon. Friend the Member for Ormskirk, that is prepared to sell without frills? One firm I know in London has 66 shops which sell at the lowest possible level. Many of the other shops round about sell the same articles at a slightly higher price because they give greater facilities and greater service. What will the Government do? Will they say that everybody must sell at what happens to be the lowest retail price? This is an enormous problem.

If the Government are serious in keeping down prices and saying that there shall be no increases, they should not come to the House and be so hypocritical as to allow price increases in nationalised industries whenever and wherever they may come almost without question and then introduce a Bill like this to pillory the retailer, who is in constant competition, not only with shops in other parts of the country, but with others around him, who will undersell him if they possibly can.

6.0 p.m.

Mr. Stanley R. McMaster (Belfast, East)

I support the Amendment which has been so ably moved by my hon. Friend the Member for St. Ives (Mr. Nott), who made one of the best speeches which we have heard during the passage of the Bill. I support all that my hon. Friend the Member for Gillingham (Mr. Burden) has said. He has spoken with great depth of knowledge and has developed the argument put forward by my hon. Friend the Member for Ormskirk (Sir D. Glover).

Is it not ridiculous that a shop in London which, perhaps, gives credit for three months and delivers the goods to one's door should be forced to sell its goods at the same price as another shop in which one has to pay cash and carry the goods away?

Mr. Burden

What about the position of the credit draper, who sells from door to door and has to charge more for the credit service which he gives, which often amounts to a year's credit?

Mr. McMaster

This brings home to the House how totally misconceived is the Bill and the Clause. This part of the Bill, dealing with retail prices, is, perhaps, the most sinister part of it. It interferes in the fundamental law of our economy that the price of goods shall be determined by the relationship between supply and demand. If we interfere with prices and artificially keep them down, the supply will not increase because it increases only when the price rises.

Mr. Mendelson

The hon. Member is suffering from the severe disadvantage of not having heard the speech of his right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), who speaks for his party in these matters and who tried to prove conclusively that it is a matter of make-believe. The hon. Member is trying to blame the Government for all the misdeeds in which his right hon. Friend does not believe.

Mr. McMaster

I firmly believe that the Bill is misconceived and could not have very much effect on the market. My worry is that it is the tip of an iceberg an initial step which might later be broadened. It is a very bad precedent to have on the Statute Book and it could well be extended. I am dealing with what will happen if it is extended.

The strength of the country as a trading nation depends on the flexibility of our economy and our ability to produce goods which the world needs. We will produce goods in a free economy only when the price rises, because that is the bait to the entrepreneur and the industrialist to produce the goods which are needed. Unless the price is allowed to move freely and flexibly, manufacturers will not produce the goods that the country needs and, therefore, by their not being produced for home consumption, none will be available for export. Japan has not become a great trading nation since the war by applying policies such as those.

I wanted briefly to make the point of the inequity between various retailers, some giving good service and others bad, and, secondly, to underline the point that in a virile and changing economy we must allow prices to move freely to enable the economy to move flexibly and to meet world demand for Britain's goods.

Mr. Higgins

The point which emerges from this important debate is that the Government's proposals for controlling retail prices are humbug. To use them would create impossible nonsense. If the debate has been somewhat lighthearted, it is clearly because of some of the ludicrous proposals which have been made from the other side of the House about how retail prices might be controlled.

I want particularly to take up a point made by the hon. Member for Tottenham (Mr. Atkinson) in referring to the speech of my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod). Our position on this side of the House is abundantly clear. We believe that it is a vitally important function of the Government to control the level of prices, because if we do not do so, the effect on those with fixed incomes and on our balance of payments would be severe and important. It is, however, absolute nonsense for the Government to try to control individual prices.

That comes out clearly in the Government's White Paper which now forms Schedule 2 to the 1966 Act. The Government said in paragraph 7 of the White Paper: It would not be in the interests of economic efficiency to seek to operate the policy in a rigid form involving a very widespread and detailed supervision of individual prices. That answers the point made by the hon. Member for Tottenham when he suggested the adoption of a system of licences.

We want to know from the Government Front Bench what is the position concerning the banner headlines which appeared in the Daily Express. Are we to understand that the Government propose to establish a group of inspectors, as one might call them, or snoopers who will go round looking at individual retail prices? I hope that we shall have either a denial or a clear statement of intent about this from the Government Front Bench. We want to know what is their position concerning retail prices.

Reference has been made in earlier speeches to the correspondence which right hon. and hon. Members, on both sides, have had. The vast majority of the letters which I have had about price increases have been concerned with increases by the nationalised industries. We are firmly convinced that that is something for which the Government have responsibility.

Mr. Paget

May I remark how much we on this side welcome the enthusiasm on the benches opposite for increased subsidies to nationalised industries, which is what the rejection of price increases would mean?

Mr. Higgins

Not at all. As the hon. and learned Member well knows, it depends also on the standard of efficiency in the industry and the arrangements which are made for raising capital.

My hon. Friend the Member for St. Ives (Mr. Nott), who admirably proposed the Amendment, certainly did not, as the Chancellor of the Duchy of Lancaster suggested, congratulate the Government on the way that they control prices. On the contrary, he condemned them out of hand. It is only one or two gullible individuals on the back benches opposite who can believe that they were right to vote for this policy last year because the Government would succeed in controlling prices as well as incomes and would continue to do so this year. The time span over which we must judge their performance in controlling the general level of prices is not merely from the date of last July's heavy deflationary measures to this July, but the two-year period extending to next July.

The hon. Member for Willesden, West (Mr. Pavitt) said that because there was mass advertising, and manufacturers were trying to persuade people to buy one thing or another, we should not accept the Amendment. That mass advertising in no way reflects directly on the retail margin. Indeed, some retailers seek to offset it by introducing own label brands, and so on. The hon. Gentleman was off the point there.

What was much more to the point was the brilliant speech of my hon. Friend the Member for Ormskirk (Sir D. Glover) who spoke with great experience and who stressed that, in allowing for individual retail price changes, allowance must be made for the fact that the price of some items will be decreased by the forces of the market and the retailer will make a loss and that in other cases it will be necessary for the retailer to increase the price so as to make a profit on a particular item when the demand for that item has increased.

That brings me to the heart of the matter. I well recall, I think at the 1959 General Election, speaking at a street corner opposite the right hon. Member for Battersea, North (Mr. Jay). I spoke in Battersea Market. I got a question from the audience in the market asking me, "Why do you not control the price of goods sold at this market at the weekends?".

This brings us to the heart of the problem. If an attempt is made to control individual retail prices, one is inevitably forced either into the position of rationing, because it will be found that more people will want to buy at the lower controlled price—the price below the competitive level—than there are goods to supply them with, or there is the problem of a black market.

If the Government seek to control retail prices at a level which they regard as fair, as against one which is competitive, this is the kind of position which will inevitably arise. In view of the White Paper, I cannot believe that they would be so stupid as that. On the other hand, we need to know very clearly what the Government's proposals are here. I hope that we shall have a reply from the First Secretary.

I turn now to the question of what will happen about retail prices. Are we to understand that these are now to be included in the voluntary notification scheme? If so, this raises some administrative difficulties of enormous magnitude. Or are we to understand that retailers do not have to volunteer and notify increases hut, instead, Government snoopers will go round and pick on individual retailers, who will then be referred to the Prices and Incomes Board—in other words, "You need not volunteer under this part of the system, but our inspectors will go round chasing you up"?

Mr. Burden

If there are to be Government snoopers, will the Government say how many snoopers will be required to cover the whole of the United Kingdom in the way that it should be covered?

Mr. Higgins

I hope that we shall get an answer to that point if the First Secretary's answer to my questionis in the affirmative.

The point here is: are we to have a system where individual retail prices, as a result of Government inspectors going round, will be referred to the National Board? If so, it raises some fascinating questions. The powers which the Government are taking under the Clause and which we seek to amend are primarily delaying powers. They enable the Government to control price increases for a maximum of seven months.

In fact, many of the increases which will be discovered by those going round will immediately be reversed, almost before the inspectors have had a chance to report to the Government, let alone before the Government have had a chance to refer the increase to the Board or the Board has had a chance to make its report and the Government have taken any action. As we are concerned here purely with delaying powers, we want to have some idea of what situation the Government envisage these delaying powers might be used in.

If an inspector going round the country has decided to refer an increase to the Board, what allowance will be made for the question of consumer choice, a point which was raised by a number of hon. Members on both sides of the House? The service which is provided clearly makes a very big difference on the price which is to be charged. Are we to understand that the Government will control retail prices in such a way that no allowance is made for service? If an allowance is to be made for service, how is it to be measured? Are shops which give service and which, in spite of the abolition of resale price maintenance, continue to operate on a profitable basis, to be put out of business by Government price control? Will it be the case that, instead of shops continuing to give service, everyone must buy from supermarkets, where the customer wanders round and serves himself?

6.15 p.m.

It seems clear that the proposals the Government have in mind are very foolish indeed. We on this side do not believe that the proposals which the Government have put forward are practical. In fact, it is abundantly clear that the vast mass of the criteria set out in the Government White Paper, which now forms Schedule 2 to the 1966 Act—"vast mass" is an overstatement; there are in fact only eight—seem largely irrelevant to the retail trade.

For that reason, my right hon. and hon. Friends and I think that the right criteria for retail prices is to rely on the forces of the market and is to rely on competition; competition, not only amongst retailers, but amongst those buying the things which retailers sell, because we believe that in this way it will be much more likely that individual consumers will get goods with reasonable service and at a reasonable price than otherwise.

Mr. Atkinson

The hon. Gentleman has repeated that it is the Tory Party's policy to rely on the market forces. He has also said that it is the Tory Party's policy to control price levels generally, but not in any way to control individual prices or groups of prices. Can he tell us how this contradiction can be balanced?

Mr. Higgins

I agree with everything that the hon. Gentleman has said. I believe that there is no contradiction whatsoever. Therefore, I hope that not only my right hon. and hon. Friends, but hon. Members opposite, also, will support my hon. Friend the Member for St. Ives on the Amendment, which makes it abundantly clear that the Government will not propose to engage in a very foolish detailed price control or an extension of the discrimination and intimidation which they have so far restricted only to the wages field. I hope that we shall have a clear statement on what the Government's policy is on retail prices.

The First Secretary of State and Secretary of State for Economic Affairs (Mr. Michael Stewart)

I will reply very briefly, though my right hon. Friend the Chancellor of the Duchy of Lancaster has already explained what the Government have in mind and why hon. Members should not take too seriously the stories about commandos and ghosts with which some hon. Members who are not now here have regaled us.

Much of the argument in favour of the Amendment was conducted on the entirely wrong assumption that what the Government intend to do is to try to control every and any retail price, whereas the boot is on the other foot. If the Amendment were carried, it would not be possible for the Government, under any circumstances, to take any action on any retail price. Hon. Members opposite, if they are thinking of voting for the Amendment, should think twice about it, because I do not think that this would be a reasonable proposition to put forward.

Nothing that the Government have said, nothing that they have done in the use of their powers during the last 12 onths, suggests that they will attempt—

Mr. Burden rose—

Mr. Stewart

I will not give way. We have had a long debate. I listened carefully to the hon. Gentleman. He can now listen to me. He has not been here during the whole debate, as I have.

Nothing that the Government have said and no use that they have made of their powers during the past 12 months suggests that they will be likely to attempt any of the fantastic things that some hon. Members opposite have amused themselves by imagining. It cannot be put forward as a reasonable proposition that the Government should be left with no powers over retail prices.

My hon. Friend the Member for Tottenham (Mr. Atkinson) quoted the case of the control of the price of beer in the public bar. The argument was that that was, by itself an ineffective measure. I assure him that, by and large, that has by no means been so. It has been a partial measure, it is true, but it has been a valuable measure. If the Amendment were carried, it would not be possible to take even as limited a step as that. True, the powers were not used in that instance, but, if they had not been there, that limitation on prices could not have occurred.

That is the issue before the House. There is no proposal to set up the totally unworkable chimeras with which hon. Members opposite have amused themselves. The issue on which the House will vote can be put in this way. Anyone voting for the Amendment will be saying that this is a Bill to prolong certain Government powers, but they must not in any circumstances include power over the retail price of anything. I do not believe that the House will assent to that proposition.

Mr. Nott

If I may have the leave of the House, I wish to comment on the speeches of both Ministers. The Chancellor of the Duchy of Lancaster said that I had congratulated the Government on their policy. That was a thoroughly inaccurate statement. He knows that I made no such suggestion. One of the most unfortunate things that could be said of any member of the Tory Party is that he had congratulated the Government on their prices and incomes policy, a policy which is getting into more and more of a mess.

Mr. Peyton

Perhaps that statement of the Chancellor of the Duchy could be attributed to a natural misunderstanding on his part. The right hon. Gentleman treated my hon. Friend's speech as an apology, if not as one congratulating the Government, and he may have taken

that view because, if one addresses remarks to him merely with civility, the right hon. Gentleman is so unused to civility that he takes it as congratulation.

Mr. Nott

He may have taken it in that way.

Mr. Paget

On a point of order, Mr. Speaker. This is the Report stage. Has not the hon. Member for St. Ives (Mr. Nott) already addressed the House?

Mr. Speaker

Order. First, the hon. Gentleman asked leave. Second, he did not need to ask leave. We are on Report, and the mover of an Amendment, if the Bill has been to a standing Committee, may speak again without even asking for leave.

Mr. Nott

In winding up the debate on the Amendment, the First Secretary of State said that the power to control prices had not yet been used, and he cited the instance of beer prices saying, in effect, that no compulsory action had been taken. If that is so, why is it necessary to prolong this type of control over retail prices? The right hon. Gentleman has admited that it is not intended to send out any teams such as those to which certain of my hon. Friends referred.

We on this side have never claimed, so far as I know, that it is impossible to control the trend of prices generally by economic management. At a time of rising unemployment such as we now have, with falling disposable incomes and the most severe credit squeeze since the war, these elements of the Government's policy have had, of course, some effect on prices. Control over the general level of demand must have some side effect on prices. The burden of our argument is that control over individual prices by the Prices and Incomes Board cannot possibly work. I am glad that my right hon. and hon. Friends intend to divide the House on the Amendment.

Question put, That those words be there inserted in the Bill:—

The House divided: Ayes 132, Noes 185.

Division No. 428.]	AYES	[6.25 p.m.
Allson, Michael (Barkaton Ash)	Beamish, Col. Sir Tufton	Bromley-Davenport.Lt.-Col. Sir Walter
Allason, James (Hemel Hempstead)	Bennett, Dr. Reginald (Gos. & Fhm)	Brown, Sir Edward (Bath)
Aster, John	Biggs-Davison, John	Bruce-Gardyne, J.
Awdry, Daniel	Blaker, Peter	Bullus, Sir Eric
Balniel, Lord	Boyd-Carpenter, Rt. Hn. John	Burden, F. A.
Barber, Rt. Hn. Anthony	Boyle, Rt. Hn. Sir Edward	Carlisle, Mark
Carr, Rt. Hn. Robert	Hogg, Rt. Hn. Quintin	Pardoe, John
Cary, Sir Robert	Holland, Philip	Peel, John
Channon, H. P. G.	Hooson, Emlyn	Percival, Ian
Chichester-Clark, R.	Hordern, Peter	Peyton, John
Clegg, Walter	Howell, David (Guildford)	Pink, R. Bonner
Cooper-Key, Sir Neill	Hunt, John	Prior, J. M. L.
Costain, A. P.	Iremonger, T. L.	Pym, Francis
Craddock, Sir Beresford (Spelthorne)	Irvine, Bryant Godman (Rye)	Ramsden, Rt. Hn. James
Crosthwaite-Eyre, Sir Oliver	Jenkin, Patrick (Woodford)	Rees-Davies, W. R.
Crouch, David	Jennings, J. C. (Burton)	Renton, Rt. Hn. Sir David
Dance, James	Johnson Smith, G. (E. Grinstead)	Ridley, Hn. Nicholas
Deedes, Rt. Hn. W. F. (Ashford)	Jopling, Michael	Royle, Anthony
Dodds-Parker, Douglas	Kershaw, Anthony	Russell, Sir Ronald
Elliott,R.W.(N'c'tle-upon-Tyne,N.)	Kimball, Marcus	Scott, Nicholas
Emery, Peter	King, Evelyn (Dorset, S.)	Sharples, Richard
Errington, Sir Eric	Kirk, Peter	Shaw, Michael (Sc'b'gh & Whitby)
Fisher, Nigel	Kitson, Timothy	Sinclair, Sir George
Fletcher-Cooke, Charles	Knight, Mrs. Jill	Smith, John
Fortescue, Tim	Lambton, Viscount	Stoddart-Scott, Col. Sir M. (Ripon)
Foster, Sir John	Lewis, Kenneth (Rutland)	Summers, Sir Spencer
Fraser,Rt.Hn.Hugh(St'fford & Stone)	Loveys, W. H.	Taylor, Sir Charles (Eastbourne)
Glover. Sir Douglas	Lubbock, Eric	Taylor, Edward M.(G'gow,Cathcart)
Glyn, Sir Richard	McAdden, Sir Stephen	Temple, John M.
Goodhart, Philip	MacArthur, Ian	Thatcher, Mrs. Margaret
Goodhew, Victor	Macleod, Rt. Hn. Iain	Tilney, John
Gower, Raymond	McMaster, Stanley	Turton, Rt. Hn. R. H.
Grant, Anthony	Marten, Nell	van Straubenzee, W. R.
Grant-Ferris, R.	Maxwell-Hyslop, R. J.	Vickers, Dame Joan
Griffiths, Eldon (Bury St. Edmunds)	Maydon, Lt.-Cmdr. S. L. C.	Wainwright, Richard (Colne Valley)
Grimond, Rt. Hn. J.	Mills, Peter (Torrington)	Walker-Smith, Rt. Hn. Sir Derek
Hamilton, Marquess of (Fermanagh)	Miscampbell, Norman	Walters, Dennis
Harris, Frederic (Croydon, N.W.)	More, Jasper	Ward, Dame Irene
Harvey, Sir Arthur Vere	Morgan, Geraint (Denbigh)	Webster, David
Hawkins, Paul	Morrison, Charles (Devizes)	Whitelaw, Rt. Hn. William
Heald, Rt. Hn. Sir Lionel	Munro-Lucas-Tooth, sir Hugh	Wilts, Sir Gerald (Bridgwater)
Higgins, Terence L.	Noble, Rt. Hn. Michael	Wilson, Geoffrey (Truro)
Hiley, Joseph	Onslow, Cranley
Hill, J. E. B.	Page, Graham (Crosby)	TELLERS FOR THE AYES:
Hirst, Geoffrey	Page, John (Harrow, W.)	Mr. David Mitchell and
		Mr. Bernard Weatberill.
NOES
Abse, Leo	Dewar, Donald	Howie, W.
Allaun, Frank (Salford, E.)	Diamond, Rt. Hn. John	Hughes, Emrys (Ayrshire, S.)
Alldritt, Walter	Driberg, Tom	Hughes, Hector (Aberdeen, N.)
Armstrong, Ernest	Dunn, James A.	Hughes, Roy (Newport)
Ashley, Jack	Dunwoody, Mrs. Gwyneth (Exeter)	Hynd, John
Atkins, Ronald (Preston, N.)	Dunwoody, Dr. John (F'th & C'b'e)	Jackson, Peter M. (High Peak)
Atkinson, Norman (Tottenham)	Eadie, Alex	Jay, Rt. Hn. Douglas
Bacon, Rt. Hn. Alice	Edwards, Robert (Bilston)	Jeger, Mrs.Lena(H'b'n&St.P'cras,S.)
Bagier, Gordon A. T.	Ellis, John	Jenkins, Hugh (Putney)
Barnes, Michael	English, Michael	Johnson, Carol (Lewisham, S.)
Beaney, Alan	Ennals, David	Johnson, James (K'ston-on-Hull, W.)
Bence, Cyril	Ensor, David	Jones, Dan (Burnley)
Bidwell, Sydney	Evans, Albert (Islington, S.W.)	Jones, Rt.Hn.Sir Elwyn(W.Ham,S.)
Bishop, E. S.	Evans, loan L. (Birm'h'm, Yardley)	Judd, Frank
Blackburn, F.	Fernyhough, E.	Kelley, Richard
Bowden, Rt. Hn. Herbert	Fletcher, Ted (Darlington)	Kerr, Russell (Feltham)
Braddock, Mrs. E. M.	Foot, Michael (Ebbw Vale)	Leadbitter, Ted
Brooks, Edwin	Fowler, Gerry	Lee, Rt. Hn. Frederick (Newton)
Brown, Rt. Hn. George (Belper)	Fraser, John (Norwood)	Lee, Rt. Hn. Jennie (Cannock)
Brown, Bob(N'c'tle-upon-Tyne, W.)	Fraser, Rt. Hn. Tom (Hamilton)	Lee, John (Reading)
Brown, R. W. (Shoreditch & F'bury)	Freeson, Reginald	Lewis, Ron (Carlisle)
Buchan, Norman	Gordon Walker, Rt. Hn. P. C.	Lipton, Marcus
Butler, Herbert (Hackney, C.)	Gray, Dr. Hugh (Yarmouth)	Lomas, Kenneth
Carmichael, Neil	Greenwood, Rt. Hn. Anthony	Loughlin, Charles
Coe, Denis	Gregory, Arnold	McBride, Nell
Coleman, Donald	Griffiths, Will (Exchange)	MacCoH, James
Conlan, Bernard	Hamilton, James (Bothwell)	MacDemtot, Niall
Craddock, George (Bradford, S.)	Hamling, William	McGuire, Michael
Crawshaw, Richard	Hannan, William	Mackie, John
Crosland, Rt. Hn. Anthony	Harper, Joseph	Mackintosh, John P.
Crossman, Rt. Hn. Richard	Harrison, Walter (Wakefield)	Maclennan, Robert
Dalyell, Tam	Haseldine, Norman	MacPherson, Malcolm
Darling Rt. Hn. George	Hattersley, Roy	Mahon, Peter (Preston, S.)
Davidson, Arthur (Accrington)	Hazell, Bert	Mallalieu,J.P.W.(Huddersfield,E.)
Davies, Dr. Ernest (Stratford)	Heffer, Eric S.	Manuel, Archie
Davies, G. Elfed (Rhondda, E.)	Henig, Stanley	Mapp, Charles
Davies, Harold (Leak)	Herbison, Rt. Hn. Margaret	Maxwell, Robert
Davies, Ifor (Gower)	Hooley, Frank	Mellish, Robert
Davies, S. O. (Merthyr)	Houghton, Rt. Hn. Douglas	Mendelson, J. J.
Delargy, Hugh	Howarth, Harry (Wellingborough)	Milne, Edward (Blyth)
Dell, Edmund	Howarth, Robert (Bolton, E.)	Morris, Alfred (Wythenshawe)

Morris, Charles R. (Openshaw)	Price, Thomas (Westhoughton)	Tuck, Raphael
Morris, John (Aberavon)	Rees Merlyn	Urwin, T. W.
Murray, Albert	Roberts, Albert (Normanton)	Wainwright, Edwin (Dearne Valley)
Newens, Stan	Roberts, Gwilym (Bedfordshire, S.)	Walker, Harold (Doncaster)
Noel-Baker, Rt.Hn.Philip(Derby,S.)	Robinson, W. O. J. (Walth'stow, E.)	Watkins, David (Consett)
Oakes, Gordon	Roebuck, Roy	Watkins, Tudor (Brecon & Radnor)
Ogden, Eric	Rose, Paul	Wellbeloved, James
O'Malley, Brian	Shaw, Arnold (Ilford, S.)	Whitaker, Ben
Orbach, Maurice	Shore, Peter (Stepney)	White, Mrs. Eirene
Orme, Stanley	Short, Rt.Hn.Edward(N'c'tle-u-Tyne)	Whitlock, William
Owen, Dr. David (Plymouth, S'tn)	Short, Mrs. Renée(W'hampton,N.E.)	Willley, Rt. Hn. Frederick
Owen, Will (Morpeth)	Silkin, Rt. Hn. John (Deptford)	Williams, Alan (Swansea, W.)
Page, Derek (King's Lynn)	Silverman, Julius (Aston)	Williams, Alan Lee (Hornchurch)
Paget, R. T.	Slater, Joseph	Williams, W. T. (Warrington)
Pannell, Rt. Hn. Charles	Small, William	Willis, George (Edinburgh, E.)
Parker, John (Dagenham)	Snow, Jullan	Wilson, William (Coventry, S.)
Parkyn, Brian (Bedford)	Spriggs, Leslle	Winterbottom, R. E.
Pavitt, Laurence	Stewart, Rt. Hn. Michael	Woof, Robert
Pearson, Arthur (Pontypridd)	Summerskill, Hn. Dr. Shirley
Peart, Rt. Hn. Fred	Taverne, Dick	TELLERS FOR THE NOES:
Pentland, Norman	Thomas, George (Cardiff, W.)	Mr. Charles Grey and
Perry, George H. (Nottingham, S.)	Tinn, James	Mr. John McCann.

Mr. Higgins

I beg to move Amendment No. 4, in page 1, line 14, to leave out from 'recommendation' to first 'the' in line 15 and insert 'against'.

Mr. Speaker

With this Amendment we can also take Amendment No. 23, in page 3, line 9, leave out from 'recommendation' to 'an' and insert 'against'.

Mr. Higgins

The drafting of the Bill is not the simplest thing in the world, and this Amendment is not very simple, either. Briefly, I will explain its intention. It will be seen that Clause I says that where, by reference to the National Board for Prices and Incomes under Section 2(1) or (3) of the Prices and Incomes Act, either an increase in prices or an increase in a wage settlement is forbidden then, … before it ceases to be so forbidden, a report of the Board on the reference is published with the recommendations adverse in any respect to the increase of the prices or charges … and the Government may take action.

This Amendment is similar to one which we debated in Committee, when we sought to remove the words "in any respect." It seemed to us that the use of these words was extremely ambiguous. Ambiguity has been one of the features of the Government's Prices and Incomes Bills the ambiguity of the drafting last year, and the Government's refusal to alter it subsequently, has been responsible for a very high percentage of the Prices and Incomes Orders which have passed through the House being annulled, either by the decision of the court, or by the subsequent decision of the Government. It has been very difficult to clarify precisely what this expression means.

To do so, we propose this Amendment, which is to delete words as set out on the Notice Paper and insert the word "against", so that the Government will only take action if the report of the Board on price or wage increases is clearly against that increase.

If the Amendment is not accepted it may be that the Government would have to take action, even though only a very small proportion of the total report of the Board was against the increase. The extraordinary thing was that in Committee, the Chairman had to use his casting vote to ensure that the Amendment which we were then proposing was not accepted. We divided the Ayes and the Noes equally and the Chairman then said: This is where I use my casting vote. I think that it would be fair that I should vote for the Bill as it stands to enable Members to have another opportunity to discuss the Amendment later. I therefore give my casting vote to the Ayes, and the Ayes have it"—[OFFICIAL REPORT, Standing Committee A, Tuesday, 27th June, 1967; c. 109.] The Amendment that we are now discussing is similar in intent, although, I think, somewhat better drafted than the Amendment we were then discussing. It is quite remarkable that such a situation should arise in Standing Committee. The Government should have had their full majority because none of those Members who had abstained on the Government's policy on the Floor of the House were on the Committee.

The point that we wish to make is that we want wording which will ensure that the balance of the Prices and Incomes Report shall be against the increase of the wage or the price concerned. By inserting the word "against" this clearly implies that, on balance, the report would have to be adverse. The First Secretary said, on the Second Reading of the Prices and Incomes Bill: In all cases—and this is an essential principle of the Bill—the Government will not be able to act in a manner more hostile to a proposed increase than is the report of the Board."—[OFFICIAL REPORT, 13th June, 1967; Vol. 748, c. 330.] Unless this Amendment is accepted there is an inconsistency in the Government's approach to what they put forward as an important point of principle on Second Reading. They were arguing that the Government would not be more hostile than the Board, so, clearly, if they can take action even though a small part of the report is contrary to the increase, they are acting inconsistently with the principle enunciated on Second Reading. Unless the Amendment is accepted there will be a basic and fundamental inconsistency in their policy.

From that broad outline, I want to turn to one or two specific examples to show the kind of difficulty which might arise if this Amendment is not accepted. The Report of the National Board for Prices and Incomes on the Prices of Compound Fertilisers, page 18, which is headed "Our Conclusions", says: We have no doubt that in the long-term an increase in the rate of return"— that is, of those making compound fertilizers— is desirable. Are we to understand that this is an unfavourable or adverse comment by the Board? If one looks at the particular context in which that quotation arises, it is still by no means clear whether that should be regarded as favourable or unfavourable.

The Board's Report No. 13, on Costs, Prices and Profits in the Brewing Industry, which has already been referred to, says in paragraph 52, on page 13: Examination of the level of profits shows that in absolute terms the return on capital employed in brewing was higher than that in general manufacturing and distribution in 1962 and 1963, but lower in 1964. Are we to understand, within the terms of the Bill, that this is an adverse comment in any respect? Would this particular phrase enable the Government to take action under this Clause which we are now debating? The term "adverse in any respect" is so nebulous as to be utterly meaningless, and it is for this reason that we move the Amendment. I hope that it will at least do something to clarify the situation or to bring from the Government some indication of what they feel the right interpretation is.

It may be that they intend to refer only to the actual conclusions of the Prices and Incomes Board in any particular report. But even that is not clear. If the Board made a statement at some point in a report before its conclusions or recommendations, it is not clear whether that would be regarded as sufficient basis for the Government to take action. Perhaps the Joint Parliamentary Secretary to the Ministry of Labour will say whether this is intended to be restricted to the conclusions or recommendations of the Board, and if that is not so, in what respects the phrase is limited. The drafting does not make the matter clear.

Finally, we want to be clear whether the expression "in any respect" refers to the short term or the long term. In many of its Reports the Board says that it "takes a view" that such-and-such a price or wage change would eventually be desirable, but is not desirable in the period of the freeze. What is the position in the period when the Government are taking stronger delaying powers than they were originally going to take under Part II? Are we to understand that they are now to take the matter, on balance, over the long term or concern themselves still only with short-run considerations?

I think that I have said sufficient to make the point that the wording of the Bill on this point is extremely ambiguous and inconsistent with the statement made by the First Secretary on Second Reading.

6.45 p.m.

Mr. Peyton

I gladly give my support to my hon. Friend the Member for Worthing (Mr. Higgins), who has moved this verly sensible Amendment with commendable brevity. In considering it, we must have in mind the kind of animal that the Prices and Incomes Board is. Our experience with it does not leave us to believe that it is particularly modest in its approach to its terms of reference. It has performed some fairly drastic surgical operations on what has been put before it in the past. Either the terms of reference have been exceedingly liberally construed or they have been more deliberately widened.

By means of the Amendment we might wed put upon the Board the onus of coining down one way or the other. When hon. Members are asked to vote, they vote for or against. The Opposition are very well acquainted with the endearing habit of hon. Members opposite who speak very strongly for a policy during a debate and then oppose it—

Mr. Speaker

Order. The hon. Member is just out of order at the moment.

Mr. Peyton

I am sorry, Mr. Speaker. I was giving the briefest and most rapid of illustrations of the point that I am making, which is highly germane to the issue.

But I will approach it the other way round and say that we think that the Board should be called upon to follow the examples of procedures here and come down one way or the other—for or against. If the Board's judgment in a matter were to be based on the criterion suggested here—namely, if it were "in any respect" adverse—we might take the examples of speeches made in the House by many hon. Members who could frequently be said to be in many respects adverse in their judgment to Government policy and yet they immediately vote for it. We wish to avoid this happening, and. I think that the Government Front Bench would be well advised to accept the very modest Amendment so wisely and sensibly proposed by my hon. Friend.

I do not believe that to add loose verbiage to an Act is any help. It has become a very tiresome habit of modern times—I have complained about it on many occasions—never to use one word where a great many more will do. Here we have a further example. There is the perfectly simple word "against" that could be used. I would willingly stop the argument now if the Joint Parliamentary Secretary, sitting between what I suppose can be termed his two supporters on the Government Front Bench, would set up, like Moses, between them, and tell us that he was prepared to accept the Amendment. However, we on this side need a good deal of satisfying that the Amendment is not a perfectly reasonable one to make. We should like the simple word "against" inserted in place of the highly misleading phrase in this already rather discreditable and untidy Bill.

Sir D. Glover

I did not have the honour and privilege of being a member of the Standing Committee, but from what my hon. Friend the Member for Worthing (Mr. Higgins) said I am surprised that the Government have not brought the Amendment forward under their own name. It seems to me—I agree with my hon. Friend the Member for Yeovil (Mr. Peyton)—that we ought to try to have words which mean something and to use one simple, forthright word to express the Government's intention instead of half-a-dozen words. Incidentally, I think that my hon. Friend the Member for Yeovil might have referred to the two supporters of the Joint Parliamentary Secretary on the Government Front Bench as "lions couchant."

I agree with what has been said about the Prices and Incomes Board. It is not a very modest, wilting flower. It comes forward with some outrageous recommendations, and it ought to be asked to be forthright in those recommendations. It ought to be either for or against. When we divide in this House we do it not because we are "adverse", but because we are "against". If that is the sort of thing that we require here, then it is the sort of thing that ought to appear in the Bill.

I cannot imagine what argument the Joint Parliamentary Secretary will raise against the Amendment. I emphasise that if the Board makes a recommendation on something referred to it it ought to be either for or against. Something in this field might be taken to a court of law. I am sure that our Amendment would be supported by the judges, who say that far too often this House passes weak and woolly legislation and so the courts have to make their own interpretation of it. In the case before us it is clear that if we deleted the words that we propose to delete and inserted "against" there would be a clear and consistent body of law on which one could build and on which decisions would be taken.

I hope that the Joint Parliamentary Secretary will bear in mind the history of the Amendment. In Committee, the Chairman gave his casting vote for the Bill as it stood, but it must be remembered that it is a long-standing rule of the House and of Committees that the Chairman always votes for the status qua. Therefore, it does not in any way express the Chairman's views on the rights of the arguments on an Amendment in Committee. In Committee, the Government were, therefore, defeated, and I think that they were sensibly defeated. There is no actual party division in our Amendment. It is simply an Amendment which would make the Clause very much clearer than it was. I hope that the Government will be able to accept it. If not, I hope that my right hon. and hon. Friends will divide the House, because the Government are, as usual, producing nonsense.

Mr. Paget

Is there not the objection to this Amendment that it is not grammar? The Opposition are asking to make an adverb qualify a noun. If they wish to make this change, they would also have to change "recommendation" to "recommend against". One cannot have a recommendation against because it is an adverb.

Mr. John Pardoe (Cornwall, North)

I am no grammarian and I support this eminently sensible Amendment. It is extraordinary that the Government have not thought fit to put it in the Bill themselves. Whether the Amendment is good or bad grammar, the Bill as it stands is extraordinarily vague.

When I moved a similar Amendment during the Report stage of the 1966 Act—an Amendment which the Government have accepted for this Clause—I envisaged the situation in which the Board could report wholeheartedly against an increase, in which case we would be left in the ridiculous situation in which the increase could go ahead on the very day that the report was published.

At that time, I did not go into the considerable difficulties that could arise when the Board reported and no firm decision was reached. One could arrive at a situation where it rather sat on the fence. It would be a poor Government who could not find something which could be termed "adverse" in some respect. In the present drafting, the Gov- ernment are being left with far too much discretion of interpretation. They could take a broadly favourable report and find something in it which could be brought under this vague phraseology.

The Joint Parliamentary Secretary to the Ministry of Labour (Mr. Roy Hattersley)

The hon. Member for Worthing (Mr. Higgins) rightly said that the Amendment was in many ways parallel with one moved in Committee. But, if I may say so, his objections to the Clause in Committee were more succintly and positively put than his objections today. In Committee he told us that he hoped to ensure that the Government did not abuse a report of the Board. He wanted to ensure that we used it in a balanced and sensible way. He feared that the Government would pick on one small adverse point in a fundamentally favourable report and impose the full powers of the Clause. I hope to be able to convince the hon. Gentleman that such a state of affairs could never come about but, before doing so, I want to deal with the need to avoid ambiguity, to which he referred. It does not seem to me that, by deleting the words proposed and substituting the word "against", ambiguity would be avoided. The hon. Gentleman will have to explain how a court would be able to decide whether a standstill could be imposed if a report from the Board was entirely against, on balance against, substantially but not comprehensively against, or specifically against one part.

In a speech devoted to the virtues of avoiding ambiguity, the hon. Gentleman began by talking about a report being "clearly against" and he ended with a report that might be "on balance against". If he asks us to insert an Amendment partly to make the provisions of the Bill more comprehensive and to be more precise legally, he must do rather better than this. The Amendment would not make the Bill more clearly able to be implemented or its operation more precise. It would make it open to a good deal more dispute and argument. I am glad to see that I receive some support from hon. Members opposite on that point. However, the main argument against the Amendment is not the ambiguity to which it would give rise.

Mr. Peyton

Can the hon. Gentleman tell us whether in putting this argument he has the support of the Solicitor-General? If he has, this would weigh with us a great deal—although I am not saying which way.

Mr. Hattersley

I am sure that the hon. Gentleman knows that the nature of common responsibility means that, unfortunately, my right hon. and learned Friend the Solicitor-General at the moment has to accept the judgment I am putting forward. I am sure the hon. Gentleman understands equally well that, had I not a firm basis for making this posit, I would not have the temerity to make it to the House—certainly not to a House in which he was sitting.

Mr. Higgins

If the Board were to say, "We are against this increase", would not this present no verbal problem?

Mr. Hattersley

Indeed, but when the Board says, "We have reservations about this increase; part of it is admirable but part deplorable", the Amendment goes no way to meeting that sort of verbal problem. But, as I have said, this should not be the main complaint against the Amendment. Were we to feel that there were substance in the argument for the Amendment, our obligation would be to redraft the Amendment to make it appropriate.

The substance of our argument is that the fears the hon. Gentleman expressed in Committee and has repeated today are groundless, for the reasons that he himself touched on but did not develop. Paragraph 2(1) of the Schedule to this Bill refers the Government to Schedule 2 of the Prices and Incomes Act, 1966, which specifies and stipulates the Government's attitude towards prices and in-conies matters. Schedule 2 of the Act, to which this Clause and the Amendment refer, lays down for the Board the nature of its considerations and its obligations and the things it must consider. Paragraph 2(1) also makes it clear how the Government must react to the conclusions to which the Board has come. It says that the Government: … shall not preclude an increase in prices or charges or the implementation of an award or settlement in any respect in which the National Board for Prices and Incomes … recommend that it should not be precluded … I will give a clear example, because I think that hypotheses in this situation are potentially dangerous. The hon. Gentleman will recall the case of the Crown Bedding Company, where the Government decided that a major wage increase that the Company was contemplating did not conform with the requirements of the prices and incomes policy but considered that a reduction in the working week for the drivers from 42½ to 41 hours did so conform.

Within the powers vested in my right hon. Friend the First Secretary of State, an order was made against the major increase but a letter of consent was provided which enabled the minor increase to go ahead. What Paragraph 2(1) of the Schedule to the Bill means is that, if a report of that sort came from the Board saying that a major pay award was unacceptable but that a minor alteration in remuneration, a minor reduction in hours or a minor increase for some of the men was possible, my right hon. Friend would be precluded from preventing that part of the award which was not referred to adversely from going ahead.

By allowing the Clause to remain as it is, and by not amending it as the hon. Gentleman suggests, we have a great deal more opportunity for flexibility, for reasonableness, for exercising the sort of discrimination which I am sure we all want and expect. But we do not have an opportunity to exercise discrimination and flexibility which is in any way more detrimental to the parties than any part of the Board's report recommends. Our discretion can be exercised only in their favour. That is why the hon. Gentleman was wrong to say in Committee that the need for the Amendment was exemplified by the fact that this was an all or nothing situation. He said that the phrase used in the Bill could either be accepted or abandoned and that there were no half measures.

7.0 p.m.

It is not an all or nothing situation. It is a situation in which my right hon. Friend, the First Secretary, may on occasion rightly wish to choose one element of the Board's report and say, "This can go on", but choose another in regard to which the Board has specifically said that the increase is not within the terms of the policy and not in line with the national interest and say, "This cannot go on". I am sure that the House wants to give him that opportunity to discriminate. It does not want to impose upon the Prices and Incomes Board an obligation to come formally and firmly and definitely down on one side or the other. The hon. Gentleman the Member for Worthing did not advance the argument that it should, but his hon. Friend the Member for Yeovil (Mr. Peyton) and the hon. Member for Ormskirk (Sir D. Glover) suggested that this was the rôle that the N.B.P.I. could occupy. I believe that this is a fatuous rôle to expect the Board to perform. Its job is to look with some sort of objectivity and intellectual understanding, and with the best information at its disposal, at an award and to make a judgment on it; if it has many aspects, to make a judgment upon the aspects; and, if it has many different details, to make judgments upon the details. To ask it to raise its hand or nod its head and say that an award is altogether good or altogether had misunderstands the rôle of the N.B.P.I. and misunderstands the interests of the incomes policy. In consequence I must ask my hon. Friends to resist the Amendment.

Mr. Higgins

The Joint Parliamentary Secretary's speech, delivered with his usual fluency and charm, sounded very plausible, but I suspect that when one reads it it will sound a great deal less plausible.

I will put forward one or two reasons why I think this is likely to be so. While there might be some legal difficulty if the Board did not come out clearly one way or the other, none the less there should be no difficulty in drafting an Amendment in such a way that the wording of the Bill was consistent with the speech which the First Secretary made on Second Reading. I do not think it is consistent. It is quite possible under this Clause for the Government to take action which is more severe than the recommendation which is in the Board's report.

If this were not so and if the right hon. Gentleman wanted to make sure it were so, clearly he ought to have inserted in the original draft of the Bill that the Government would take action only if a recommendation was adverse in any particular instance. In that situation the Government could not go further than the report of the Prices and Incomes Board. Unless he narrows it down—no doubt he could have done so either when the Bill was drafted or during Committee stage or now—and says that the Government shall take action only with regard to the respects in which the Prices and Incomes Board reports unfavourably, then he is being inconsistent with the speech which he made on Second Reading. It is clearly a badly drafted Bill and I would report adversely on it in that respect.

Mr. Hattersley

May I clarify the position in terms of the wording of Clause 2(1) of the Schedule. It simply says that my right hon. Friend … shall not preclude an increase of prices or charges or the implementation of an award or settlement in any respect in which the National Board for Prices and Incomes in the relevant report recommend that it should not be precluded … That final part of the sentence which refers to "it", recommend that it should not be precluded", firmly and clearly and precisely limits the power of my right hon. Friend in judging parts of a report, parts of an issue, and limits it to judging it in the way I have explained. Those final words make it clear that my right hon. Friend cannot possibly be more repressive and cannot implement a report in a way in which the Prices and Incomes Board has not specifically recommended.

Mr. Higgins

I am grateful to the hon. Gentleman. We shall read HANSARD with interest and we shall judge his action during the period of the Bill accordingly and we may have cause to return to the matter anon.

The point that he has just made about the way in which the Prices and Incomes Board is therefore circumventing Government action, if he is right on the drafting, raises some other important points to which we shall return perhaps on the next Amendment.

The Parliamentary Secretary should perhaps take up some of the points which he made during the Committee stage. He said that I seemed to expound the points more simply than I did today. This is because the complexities of the situation are becoming clearer. The hon. Gentleman this afternoon said that he did not wish to hypothesise; he wanted to take a specific case. In Committee he said that he did not want to hypothesise about possible references to the Board without giving hypothetical examples, and he then produced a hypothetical situation in which he referred to a series of related prices or a group of related wage claims. He has not put forward that argument this afternoon. Are we to understand that this argument no longer applies or are we to understand that this is still the purpose of this aspect of the Clause? This is not clear from the debate we have had so far. I hope that we shall have a statement from the hon. Gentleman clarifying whether the multi-argument still applies, because this will seriously affect some of the other Amendments which we come to later.

Mr. R. Carr (Mitcham)

I do not want to delay the House, but my hon. Friend the Member for Worthing (Mr. Higgins) asked the Parliamentary Secretary, or a spokesman of the Government, to clear up the point which he was making, which was the main case on which the Parliamentary Secretary rested his opposition to our Amendment in Committee. It was very noticeable in his speech today that he did not use that argument. I, therefore, ask the Government to reply to the point which has just been made.

Mr. Hattersley

With the leave of the House: I was even more careful not to hypothesise today. In Committee I did mention what I rather inelegantly referred to as a multi-reference. Today I made reference to one group of people whose wages had already been considered in the House and about whom the Government had to make a decision concerning

the two aspects of increased remuneration, namely, hours and the rate of pay. The argument remains valid in the same way. If—and here I fear that I do hypothesise—a reference is made to the Board which concerns a group of related workers or a group of related prices, and examines every aspect of their wages and remuneration, my right hon. Friend would want to have the opportunity and would want to keep the option open of implementing the standstill in respect of those related parts of the report.

I do not think that the hon. Gentleman understands, but I am sure that he will on reflection, that the distinctions between a report about one group of men and two different aspects of their increase in remuneration, and a report which concerns related groups of men with rather different remuneration patterns is not very fundamental. We are making provision for a situation in which the Board may want to make a report which contains a number of elements. I do not think it matters how the elements are brought about. We want to reserve the right to operate on each element as the Board suggests and not necessarily look at the report as all black or all white.

Mr. Higgins

I am grateful to the hon. Gentleman, but does that not mean that the point which he made on Committee Stage is not covered by the expression "adverse in any respect"? Should it not read, "with regard to certain people within the group who have been referred to the Board"?

Question put, That the words proposed to be left out stand part of the Bill:—

The House divided: Ayes 190. Noes 127.

Division No. 429.]	AYES	[7.9 p.m.
Abse, Leo	Braddock, Mrs. E. M.	Dalyell, Tam
Alldritt, Walter	Brown, Rt. Hn. George (Belpar)	Davidson, Arthur (Accrington)
Archer, Peter	Brown,Bob(N'c'tle-upon-Tyne,W.)	Davies, G. Elfed (Rhondda, E.)
Ashley, Jack	Brown, R. W. (Shoreditch & F'bury)	Davies, Harold (Leek)
Atkins, Ronald (Preston, N.)	Buchan, Norman	Davies, Ifor (Gower)
Atkinson Norman (Tottenham)	Butler, Herbert (Hackney, C.)	Davies, S. O. (Merthyr)
Bacon, Rt. Hn, Alice	Callaghan, Rt. Hn. James	Delargy, Hugh
Bagier, Gordon A. T.	Carmichael, Neil	Dell, Edmund
Barnes, Michael	Coe, Denis	Dempsey, James
Baxter, William	Coleman, Donald	Dewar, Donald
Beaney, Alan	Conlan Bernard	Diamond, Rt. Hn. John
Bence, Cyril	Craddock, George (Bradford, S.)	Doig, Peter
Benn, Rt. Hn. Anthony Wedgwood	Crawshaw, Richard	Driberg, Tom
Bidwell, Sidney	Cronin, John	Dunn, James A.
Bishop, E. S.	Crosland, Rt. Hn. Anthony	Dunwoody, Mrs. Gwyneth (Exeter)
Boardman, H.	Crossman, Rt. Hn. Richard	Dunwoody, Dr. John (F'th & C'b'e)
Bowden, Rt. Hn. Herbert	Cullen, Mrs. Alice	Eadie, Alex
Ellis, John	Jones, Dan (Burnley)	Pearson, Arthur (Pontypridd)
English, Michael	Jones, Rt.Hn.Sir Elwyn(W.Ham,S.)	Peart, Rt. Hn. Fred
Ennals, David	Judd, Frank	Pentiand, Norman
Ensor, David	Kerr, Russell (Feltham)	Perry, George H. (Nottingham, S.)
Evans, Albert (Islington, S.W.)	Lawson, George	Price, Thomas (Westhoughton)
Evans, loan L. (Birm'h'm, Yardley)	Leadbitter, Ted	Bees, Merlyn
Fernyhough, E.	Lee, Rt. Hn. Frederick (Newton)	Roberts, Gwilym (Bedfordshire, S.)
Fletcher, Ted (Darlington)	Lee, John (Reading)	Robinson, W. O. J. (Walth'stow, E.)
Foot, Michael (Ebbw Vale)	Lewis, Ron (Carlisle)	Roebuck, Roy
Fowler, Gerry	Lipton, Marcus	Rose, Paul
Fraser, John (Norwood)	Lomas, Kenneth	Shaw, Arnold (Ilford, S.)
Fraser, Rt. Hn. Tom (Hamilton)	Loughlin, Charles	Short,Rt.Hn.Edward(N'C'tle-u-Tyne)
Freeson, Reginald	Lyon, Alexander W. (York)	Short, Mrs. Renée(W'hampton,N.E.)
Garrett, W. E.	McBride, Neil	Silkin, Rt. Hn. John (Deptford)
Ginsburg, David	McCann, John	Silverman, Julius (Aston)
Gordon Walker, Rt. Hn. P. C.	MacColl, James	Slater, Joseph
Gray, Dr. Hugh (Yarmouth)	MacDermot, Niall	Small, William
Greenwood, Rt. Hn. Anthony	McGuire, Michael	Snow, Julian
Gregory, Arnold	Mackie, John	Spriggs, Leslie
Grey, Charles (Durham)	Mackintosh, John P.	Steele, Thomas (Dunbartonshire, W.)
Griffiths, Will (Exchange)	Maclennan, Robert	Stewart, Rt. Hn. Michael
Hamilton, James (Bothwell)	MacPherson, Malcolm	Summerskill, Hn. Dr. Shirley
Hamilton, William (Fife, W.)	Mahon, Peter (Preston, S.)	Thomas, George (Cardiff, W.)
Hamling, William	Mallalieu, J.P.W.(Huddersfield, E.)	Tinn, James
Hannan, William	Manuel, Archie	Tuck, Raphael
Harper, Joseph	Mapp, Charles	Urwin, T. W.
Hart, Mrs. Judith	Mellish, Robert	Wainwright, Edwin (Dearne Valley)
Haseldine, Norman	Mendelson, J. J.	Walker, Harold (Doncaster)
Hattersley, Roy	Miller, Dr. M. S.	Watkins, David (Consett)
Hazell, Bert	Milne, Edward (Blyth)	Watkins, Tudor (Brecon & Radnor)
Heffer, Eric S.	Morris, Alfred (Wythenshawe)	Wellbeloved, James
Henig, Stanley	Morris, Charles R. (Openshaw)	Whitaker, Ben
Herbison, Rt. Hn. Margaret	Morris, John (Aberavon)	White, Mrs. Eirene
Hooley, Frank	Murray, Albert	Whitlock, William
Houghton, Rt. Hn. Douglas	Newens, Stan	Willey, Rt. Hn. Frederick
Howarth, Harry (Wellingborough)	Noel-Baker, Rt.Hn.Philip(Derby,S.)	Williams, Alan (Swansea, W.)
Howarth, Robert (Bolton, E.)	Ogden, Eric	Williams, Alan Lee (Hornchurch)
Howie, W.	O'Malley, Brian	Williams, W. T. (Warrington)
Hoy, James	Orbach, Maurice	Willis, George (Edinburgh, E.)
Hughes, Emrys (Ayrshire, S.)	Orme, Stanley	Wilson, Rt. Hn. Harold (Huyton)
Hughes, Hector (Aberdeen, N.)	Owen, Dr. David (Plymouth, S'tn)	Wilson, William (Coventry, S.)
Hynd, John	Owen, Will (Morpeth)	Winterbottom, R. E.
Jackson, Colin (B'h'se & Spenb'gh)	Page, Derek (King's Lynn)	Woof, Robert
Jackson, Peter M. (High Peak)	Paget, R. T.
Jay, Rt. Hn. Douglas	Pannell, Rt. Hn. Charles	TELLERS FOR THE AYES:
Jeger, Mrs.Lena(H'b'n&St.P'cras,S.)	Parker, John (Dagenham)	Mr. Walter Harrison and
Jenkins, Hugh (Putney)	Parkyn, Brian (Bedford)	Mr. Ernest Armstrong.
Johnson, James (K'ston-on-Hull, W.)	Pavitt, Laurence
NOES
Alison, Michael (Barkston Ash)	Fletcher-Cooke, Charles	Lambton, Viscount
Allason, James (Hemel Hempstead)	Fortescue, Tim	Lewis, Kenneth (Rutland)
Astor, John	Glover, Sir Douglas	Loveys, W. H.
Barber, Rt. Hn. Anthony	Glyn, Sir Richard	Lubbock, Eric
Beamish, Col. Sir Tufton	Goodhew, Victor	McAdden, Sir Stephen
Bennett, Dr. Reginald (Gos. & Fhm)	Gower, Raymond	MacArthur, Ian
Biggs-Davison, John	Grant, Anthony	Macleod, Rt. Hn. Iain
Boyd-Carpenter, Rt. Hn. John	Griffiths, Eldon (Bury St. Edmunds)	McMaster, Stanley
Boyle, Rt. Hn. Sir Edward	Gurden, Harold	Maude, Angus
Bromley-Davenport, Lt.-Col. Sir Walter	Harris, Frederic (Croydon, N.W.)	Maxwell-Hyslop, R. J.
Brown, Sir Edward (Bath)	Harris, Reader (Heston)	Maydon, Lt.-Cmdr. S. L. C.
Bruce-Gardyne, J.	Hawkins, Paul	Mills, Peter (Torrington)
Bullus, Sir Eric	Heald, Rt. Hn. Sir Lionel	Miscamphell, Norman
Burden, F. A.	Higgins, Terence L.	Mitchell, David (Basingstoke)
Carlisle, Mark	Hiley, Joseph	More, Jasper
Carr, Rt. Hn. Robert	Hill, J. E. B.	Morgan, Geraint (Denbigh)
Channon, H. P. G.	Hirst, Geoffrey	Morrison, Charles (Devizes)
Chichester-Clark, R.	Hogg, Rt. Hn. Quintin	Mott-Radclyffe, Sir Charles
Clegg, Walter	Holland, Philip	Munro-Lucas-Tooth, Sir Hugh
Cooper-Key, Sir Neill	Hooson, Emlyn	Noble, Rt. Hn. Michael
Corfield, F. V.	Hordern, Peter	Onslow, Cranley
Costain, A. P.	Howell, David (Guildford)	Page, Graham (Crosby)
Craddock, Sir Beresford (Spelthorne)	Hunt, John	Page, John (Harrow, W.)
Crosthwaite-Eyre, Sir Oliver	Iremonger, T. L.	Pardoe, John
Crouch, David	Irvine, Bryant Godman (Rye)	Peel, John
Dance, James	Jenkin, Patrick (Woodford)	Percival, Ian
Davidson, James (Aberdeenshire, W.)	Jennings, J. c. (Burton)	Peyton, John
Deedes, Rt. Hn. W. F. (Ashford)	Johnson Smith, G. (E. Grinstead)	Pink, R. Bonner
Dodds-Parker, Douglas	Jopling, Michael	Prior, J. M. L.
Emery, Peter	Kimball, Marcus	Pym, Francis
Errington, Sir Eric	King, Evelyn (Dorset, S.)	Ramsden, Rt. Hn. James
Eyre, Reginald	Kirk, Peter	Rees-Davies, W, R.
Fisher, Nigel	Knight, Mrs. Jill	Renton, Rt. Hn. Sir David

Ridley, Hn. Nicholas	Taylor, Sir Charles (Eastbourne)	Webster, David
Royle, Anthony	Taylor, Edward M.(G'gow,Cathcart)	Whitelaw, Rt. Hn. William
Russell, Sir Ronald	Taylor, Frank (Moss Side)	Wills, Sir Gerald (Bridgwater)
Scott, Nicholas	Temple, John M.	Wilson, Geoffrey (Truro)
Sharples, Richard	Thatcher, Mrs. Margaret	Wolrige-Gordon, Patrick
Shaw, Michael (Sc'b'gh & Whitby)	Tilney, John	Wylie, N. R.
Sinclair, Sir George	Turton, Rt. Hn. R. H.
Smith, John	Wainwright, Richard (Coins Valley)	TELLERS FOR THE NOES:
Stell, David (Roxburgh)	Walker-Smith, Rt. Hn. Sir Derek	Mr. R. W. Elliott and
Stoddart-Scott, Col. Sir M. (Ripon)	Walters, Dennis	Mr. Timothy Kitson.
Summers, Sir Spencer	Ward, Dame Irene

Mr. David Howell

I beg to move Amendment No. 7, in page 1, line 16, after 'settlement', to insert: 'and that recommendation arises from the terms of reference originally given to the Board'. The purpose of moving this Amendment is to make the Government and those concerned with implementing the Bill stop to ask themselves at this stage, as they plunge on into the more and more tortuous complexities of this legislation, what the National Board for Prices and Incomes is, what it is supposed to be doing and what is required of it.

As we have debated this legislation it has become clear that the Board is regarded as the pivotal instrument in the Government's carrying out of policies, not merely as an instrument in this legislation, but also as part of the long-term development of a prices and incomes policy as a permanent element in our national life, in the way in which the First Secretary is reported to have been talking about it in rather Utopian terms over the weekend. At this stage, therefore, we must ask ourselves very carefully what rôle the Board has in relation to its original terms of reference. In addition, if we read the weekend Press, we see that the Government think that there should be a permament kind of wages legislation, and no doubt there will be a rôle for the Board in this as well, so here again is a reason why we should look closely at it.

Another reason is that the Chairman of the Board, a very able man, Mr. Aubrey Jones, is one of the great managers of state who make the policy decisions in a modern Government, and who, as other managers of state in the complex which makes up our Government, has too little contact with, and no accountability to, this House. Because of this, too, it seems that it is important to look closely into the Board's terms of reference, and at the limits within which the policy influence of Mr. Aubrey Jones is to be exerted.

We on this side of the House, or some of us, have made it clear that the Board has a place in a long-term policy for prices and incomes, in a long-term view by the Government of how they should operate on prices and incomes. We have argued, and I argue now, that there is a case for any agency of this kind to operate on restrictive practices, to peer into industries, to do jobs which ought to have been done by the economic development committees, but which have not always been done, in making the market work in these industries, and ensuring that competitive forces operate. This is the kind of term and form in which we have argued, that in the long-term a Prices and Incomes Board should have this rôle.

That is one view that one can take of the Board, that it should have a place in a long-term policy, and, as I understand it from what Government spokesmen have said inside and outside the House from time to time, this is one view which they hold. It should be said, too, that that view was reflected when it was decided to ask the Board to study productivity agreements and it produced its excellent Report No. 36. This was a case of the Board being seen as an agency for a long-term improvement in competition in various industries, and not as an immediate instrument of short-term policy.

The other view of the Board is the one that we seem to have before us in the Bill, and the one which we are querying in the Amendment, namely, that it should be a sort of clearing house, almost like a daily newspaper office, checking the movement of prices, not we are told, by sending out forces across the land to study prices and watch movements at first hand, but by operating on prices and wage movements in the short-term, and being seen as part of a short-term effort to control the level of prices to beat inflation as part of the Government's short-term strategy. This is a rôle which, the more we examine it, the more we think the Government should reconsider it, and the more we doubt whether the Board can play it.

First, it has to be asked whether the Board has the physical capacity to carry out this kind of rôle—

Mr. Speaker

Order. The hon. Member must keep to the Amendment, which is whether recommendation should be within the terms of reference as laid down in the parent Act.

Mr. Howell

As I tried to explain at the beginning of my speech the purpose of the Amendment is to make those who have to implement the Bill when it becomes an Act ask themselves whether the terms of reference which were originally laid down in Part I of the Prices and Incomes Act, the parent Act, are the ones to which they would like the Board to adhere, to which the Board is adhering, and to which it is to adhere if it is to do its job efficiently. It is against this background that I am trying to distinguish between the long-term rôle of a Board for Prices and Incomes in a long-term incomes policy, and the immediate short-term tasks which apparently are being shoved on to this Board, and to query whether they are within the terms of reference when the Board makes its reports.

The terms of reference, as originally set out in Part I of the parent Act, are: The Secretary of State, or the Secretary of State and any Minister acting jointly, may refer to the Board any question … relating to a proposal to increase any prices for the sale of goods or any charges for the performance of services, including charges for the application of any process to goods, or"— and then we come to the paragraph dealing with wages— relating to any pay claims or other claims relating to terms and conditions of employment, or any awards and settlements relating to terms and conditions of employment. There then follow other terms of reference, and the final one is: The Board shall examine any question referred to them under this section and report to the Minister or Ministers who referred the question to the Board. The thought in the minds of many hon. Members, and I believe of many observers outside, is whether, in making its reports, in making recommendations on a settlement, the Board has been answering the question put to it. The terms of reference say that it should answer the original question put to it when it makes a report on a settlement.

On looking at the reports from the Board it seems that we have seen an attempt to try to cover both the rôles which I have described, an attempt to try to cover the long-term rôle of being an instrument for promoting productivity, of which I approve, and, at the same time, an attempt to be a short-term spy master, a short-term controller and checker of price and wage movements, a rôle for which I think it is ill-equipped, and which it will never effectively be able to play.

In other words, we believe that although the Board should answer questions, what will happen as a result of this Clause and what we seek to challenge by way of the Amendment, is that the Board will be asked the wrong questions, and as a result will produce reports which in some aspects will promote understanding, and even, in due course, have a beneficial effect on the competitive structure of various industries, but in other cases will waste time and raise more difficult questions about what rôle the Board should have in implementing the Government's policies. As the Government go from Bill to Bill, from legislation to legislation, and from Clause to Clause, the Board will have piled on it all sorts of vague responsibilities which I contend have not been thought out.

One of the things which the Government's supporters hoped for when they came to office was that the Government would rethink the structure and rôle of agencies of Government, including agencies of this kind, and what they should be doing when they reported. This hope has been confounded, because agencies have had larger responsibilities piled on them. The duties which they are supposed to perform have grown like Topsy. This has left the Board in an ambiguous position when it comes to judging the kind of reports that it should give. It has left it in an ambiguous position when it comes to judging whether it is within its terms of reference in making recommendations. This has tied up, unfortunately ineffectively, the capacity of many able men, which could be concentrated more usefully in reaching the goal of promoting productivity rather than in restraining earnings.

Mr. Charles Fletcher-Cooke (Darwen)

I should have thought that the Government would welcome the Amendment. All independent bodies, tribunals, commissions, and things of that sort, are apt to stray very widely outside their terms of reference. Indeed, only the other day we heard the Lord Chancellor in another place complaining that the Radcliffe Committee had not been asked to judge on the accuracy or otherwise of the Prime Ministers statement on the D Notice question, and yet it had chosen to do so.

I refer to that only in passing, as an example of the way in which independent commissions, with the best will in the world, are apt to rove generally around their subjects, and as they get into their stride to expand their activities beyond the desires of the Government, and perhaps away from the public interest, but certainly the former.

The Amendment is designed to help the Government. I am not sure that we are wise to do that. There is a great temptation to try to improve the Bill, and it is one that perhaps we ought to resist. But I cannot see what harm there can be in accepting the Amendment, which the Government may later find very valuable.

7.30 p.m.

Let us suppose, as time goes on, that the Prices and Incomes Board takes the bit between its teeth and issues a report denouncing a certain proposal left, right and centre—something which the Government do not particularly want it to do: how will the Government be able to treat the question of the subsequent Order? In view of the authority that they have been seeking to give the Board it will be difficult for the Government not to accept those denunciations. They will he placed in a difficult political position, whereas if the Amendment is accepted they will not, because they will be able to say that they have no option to go outside the strict terms of reference that they gave the Board; that in the case in question he Board has strayed outside those terms of reference, and in that case the Government not only may not but cannot act.

Surely this is a shield which the Government should welcome. Surely they must feel that there are dangers in these great independent governmental agencies, from which there is no appeal and which are without any sort of control. The Government may find themselves in a very delicate and difficult situation if they come into conflict with the Board in respect of one of its reports.

As my hon. Friend the Member for Guildford (Mr. David Howell) said, there have been signs that the Board—I make no complaint about it; it is in the nature of such an animal—has been straying outside its terms of reference, especially in respect of its report on the banks. That was an interesting report, and perhaps a very good one, but it went far outside the Board's terms of reference. If the Board has begun to do that already it is likely to go the way of all flesh in this matter and do it again.

Surely any Government must protect themselves against that. Unless they insert these words, which cannot do any harm, the Government will find themselves in the embarrassing position, sooner or later, of having to reject certain findings of the Board—and they will not want to do that. What conceivable objection could there be to these innocuous words? Surely the Government do not propose to act on a recommendation that is outside the Board's terms of reference. If that is the case, what is wrong with the Amendment?

Mr. Edward M. Taylor (Glasgow, Cathcart)

My hon. and learned Friend the Member for Darwen (Mr. Fletcher Cooke) said, in the course of his penetrating remarks, that he thought that the Amendment could do no harm. It is precisely on that point that I want to hear the observations of the Government, and in that connection there are three specific points that I wish to make.

My hon. Friend the Member for Guildford (Mr. David Howell), by saying that he thought there was a place for the Prices and Incomes Board, clearly expressed the feeling of many hon. Members on this side of the House. We are not sure whether a Board, as such, is a good thing, or whether the free disciplines of our economy provide a better way of achieving fixed wages, but it is clear, if we are to have such a Bill as this, that there are different points of view as to the extent to which the Board should be restricted. The Amendment deals with the extent of that restriction.

I was greatly impressed by the arguments of my hon. Friend the Member for Guildford, but if we are to ask the Board to investigate various wide-ranging matters we ought to appreciate that there could be danger in unduly restricting the exercise of its powers. Several of my hon. Friends and I have been very impressed at the quality of some of the Board's reports. On the other hand, it is clear that in some cases it has ranged widely beyond the specific points which it has been asked to investigate.

I now come to my three points. First, if the Amendment were accepted would it necessarily restrict any consequential recommendation which the Board might make? Let us suppose that the Board were asked to look into the wages of the boilermakers on Clydeside. Would the Amendment prevent the Board making a specific recommendation about the wages, say, of apprentice boilermakers? If that is the case it would be unfortunate. I do not think that the Amendment would restrict such a recommendation, but I should like it made clear.

The obvious thing to do would be to make the terms of reference adequate, but in existing circumstances the terms of reference might not be wide enough and the Board would be prevented from making appropriate consequential recommendations.

Secondly, would the Amendment in any way remove the liability of the Government to implement consequential recommendations not directly associated with the specific proposals put to the Board? I can give a specific example. Prices and Incomes Report No. 9 dealt with gas and electricity prices. I recall a specific recommendation made by the Board that the increase of 13 per cent. recommended for the price of gas in Scotland should be made only on the assumption that equal financial disciplines would be introduced for the electricity and the gas boards in Scotland. In Scotland the Electricity Board is organised by the Secretary of State for Scotland, under his general jurisdiction, whereas the Gas Board is under the jurisdiction of the Minister of Power.

Thirdly, if the Amendment is accepted, together with all the restrictions that may stem from it, does it mean that the Board would not be permitted to make recommendations about consequential increases within the same field of activities? In the Clyde shipyards, where I worked before coming to this House, there were maintenance electricians and maintenance engineers. Always, when there was an adjustment in the wages of the maintenance electricians, there was a similar automatic alteration in the wages of the maintenance engineers.

If the Board were asked to look into the wages of the maintenance electricians on Clydeside and, having done so, it took the view that although the electricians should get the increase there should not be a similar increase—because of the special circumstances of the time—in the wages of maintenance engineers, would the Amendment prevent the Board's making any such recommendation?

Mr. Fletcher-Cooke

The Amendment does not preclude the Board from making any recommendations it chooses. All it does is to preclude the Government from acting on any recommendation which is ultra vires the Board's terms of reference.

Mr. Taylor

I understand that the Board can recommend what it likes, but this is a question of restricting the actions of the Government. It would be a little unfortunate if, for example, as in the case that I have quoted in respect of maintenance engineers and electricians, the Government, because of a specific recommendation of the Board, allowed an increase in the wages of maintenance electricians but were not prepared to go ahead and make at the same time a similar increase in the case of the engineers.

My hon. Friend may take the view that the Government should not have power to stop wage increases which had not been considered at the time of instituting the investigation, but the terms of reference—sometimes because they were too wide and sometimes because they were too narrow—might make nonsense of everyday practices in industry if the Government did not have a little scope for carrying out various proposals.

It would be unfortunate if we restricted the Board's activities. I have been very impressed by the quality of its reports and would like to think that this roving band of "whizz kids" would move around not only private industry but the nationalised sector and public service where there is scope for more inquiry. The figures given at Question Time today about the substantial drop in the numbers employed in electrical manufacture and engineering and a substantial rise in the nationalised industries and the Civil Service show the need for this.

Although I have been greatly impressed by my hon. Friend's arguments, I hope that the Amendment will not have this effect and that the Government can give me sufficient assurances to vote against it.

Mr. Peyton

It is seldom and with great reluctance that I differ from my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor), but today is one of those exceptions. It is all very well for him to welcome a roving band of "whizz kids" buzzing around and pontificating, but what happens to whizz kids when they grow up? I do not like to think how the Board may develop when it reaches adult status.

7.45 p.m.

The Amendment is profundly helpful to the Government, relieving them of possible embarrassments. If they refuse it, I can only attribute that to obstinacy and dangerous short-sightedness—qualities which I would attribute only reluctantly to the Chancellor of the Duchy. My hon. Friend the Member for Guildford (Mr. David Howell) was quite right to ask what the Board is and what its role is. He adduced a strong reason why its decisions should be confined to the issues covered by its terms of reference. It is not an elected body, or even governed by Civil Service rules. Its members can make speeches, appear at public meetings and on television and do other things which are not the rôle of the Civil Service.

I believe that, as a matter of practice, it delegates some duties, and I should be obliged to know what rules govern its powers of delegation. To what extent can it appoint others to carry out its duties, and how far is it right, proper or desirable to appoint consultants—

Mr. Frederick Lee

On a number of references, the Board employs consultants who are specialised in a given field.

Mr. Peyton

This is the issue which I wish to stress, as it is important. I do not say that it is wrong in all circumstances for the Board to appoint consultants, but Ministers, even in this Government, are nominally responsible to Parliament and civil servants to Ministers, as is the Board, to a lesser extent, but if it regularly establishes a chain of consultant operations, responsibility to Parliament and connection with the people's elected representatives will disappear.

We should also consider the parallel of the courts, which are bound by clear rules of procedure and evidence, with carefully defined issues before them. The opinions expressed by judges learned in the law, so far as they are not directly connected with the matter in issue, are of only minor importance. This would be the effect of the Amendment. It would relegate to only minor importance opinions expressed by the Board on matters which the Government apparently never intended it to consider.

An elected assembly should look with grave suspicion on bodies like this, whose powers are loosely defined and whose chain of responsibility is hard to trace. I cast no reflection on Mr. Aubrey Jones personally, but any body of this kind is bound to suffer from its full share of human weaknesses, and when its powers are not fettered, it is apt to grow into a fair conceipt.

This is an important issue and Parliament should say clearly that the opinions of the Board, so far as they are not directly related to its terms of reference, will carry no weight, as otherwise it will not be bound by rules but will have great power and be able to pontificate on every kind of issue, flattered enormously and unreasonably by the tribute of omniscience and ubiquity. It is wrong to attribute to such a body the detailed knowledge which we are now apparently taking for granted that it possesses.

In their own interests, I hope that, as my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) said in a cogent speech, the Government take the Amendment seriously. It is a sad train of events, leading one through the same experience again and again, when a Government are confronted with cold reason and an element of restraint and modesty and tend away from a course which these virtues direct. I had hoped that both right hon. Gentlemen would have vied with each other to say how ready they were to accept these reasonable and modest arguments, based upon prudence and a lively concern about what further disasters will happen to Parliament if power passes to such remote bodies as this.

Sir D. Glover

I support the Amendment. I am sorry that I do not agree with my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor) because this is a very important Amendment. I have no criticism to make of Mr. Aubrey Jones, who was a very distinguished Member of the House for very many years and a personal friend of mine. But in legislation we are not dealing with individuals.

Many of us feel that a great danger which confronts our society is the development of the corporate state in which Parliament has very little power. Such bodies as the Prices and Incomes Board and the Monopolies Commission, collectively forming their own rules and developing untrammelled very largely by Parliamentary control, could become a great danger to our society.

Although I have no criticism at the moment, I am disturbed when I hear that some reports of the Prices and Incomes Board are produced by an outside body of consultants. While I am sure that, with the present chairmanship of the Board, any outside body of consultants would be chosen with the utmost care, we must accept that such bodies or business efficiency experts work in the commercial field and, therefore, have interests outside the report which they are being asked to produce. It would be only too easy for a firm of consultants, either by design or by accident, to be appointed which had interests which were inimical to the report which it was being asked to produce.

There is, therefore, a danger—I do not put it higher—in the way in which matters could develop. There is no sign of it at the moment—

Mr. Stewart

It could not happen.

Sir D. Glover

It could happen.

Mr. Stewart

The hon. Gentleman said that reports are produced by outside firms of consultants. Would he give an example?

Sir D. Glover

I am reliably informed—if I am wrong—

Mr. Stewart

Then the hon. Gentleman should not say it.

Sir D. Glover

I apologise if I am wrong.

Mr. Deputy Speaker (Sir Eric Fletcher)

There is nothing in the Amendment about outside consultants.

Sir D. Glover

This is what I have been told. If I have been wrongly informed, I willingly and happily withdraw.

The Amendment refers to a recommendation which arises from the terms of reference originally given to the Board". When a firm or organisation or group of firms is being investigated by the Board, we and the people concerned know what are the Board's terms of reference. If I know anything about human relations, the people who are being investigated will, rightly, try to produce an answer to what might arise as a result of the investigation. If, however, the Board exceeds its terms of reference and produces a report which is critical of the organisation concerned but which is outside the terms of reference, inevitably the people investigated will be asked to answer a case which they never expected to have to answer.

The Government, therefore, would be well advised to accept the Amendment because the matter would then be kept within Parliamentary control and everybody would know the terms of reference given by the Government, the report will be within those terms and the people concerned will have to answer to the Minister. There is a safeguard in the Amendment which there would not be if it were not accepted. However, we may look upon the matter in the House, people are under the impression that they are under a form of attack when a matter is referred to the Board. Therefore, they have a right to know that the report to the Government will be within the terms of reference given to the Board by the Government.

If the Government accepted the Amendment, the people concerned would know the case which they had to answer before the Government took a decision. If the Government allowed the Board to go beyond its terms of reference, a great sense of injustice would be created among the firms and organisations investigated. The Amendment is a safeguard not only or the power of the Government and Parliament but, perhaps more important, of the sense of justice of the people who are investigated. I hope that the Minister will accept the Amendment.

Mr. Higgins

I support what has been said by my hon. Friends and, in particular, by my hon. Friend the Member for Guildford (Mr. David Howell), who drew a very important distinction between the task of the National Board for Prices and Incomes concerning short run increases in wages or prices and its task concerning long run developments and the examination of long run trends.

Comment has been made about the reference of bank charges to the Prices and Incomes Board. There is no doubt that in that instance the Government took greater care in framing the terms of reference than they took in other cases. It s said on page 3 of the Board's Report No. 34 on Bank Charges that … it is, in the Government's view, desirable in the public interest that the system and level of charging customers should be reviewed by the National Board for Prices and Incomes in the light of the banks' profit and dividend record. Then it adds another sentence: It is not intended that the Board should concern itself with questions of monetary policy such as Bank Rate and the general level of interest rates. Yet in its Report the Board stated in paragraph 3: The references stated explicitly: 'It is rot intended that the Board should concern itself with questions of monetary policy such as Bank Rate and the general level of interest rates.' We have interpreted this as meaning that we should not comment on the way in which monetary policy has been conducted or on the general level at which Bank Rate has been held. It would have been very surprising if it had done.

The Board continues: Nor do we consider that we should comment on aspects of monetary policy that touch only remotely and indirectly on interest rates charged by the clearing banks, e.g., certain aspects of debt management. In so far, however, as we recommend changes in the system of bank charges, such changes are likely to have considerable implications for the techniques of monetary control. We have accordingly thought it consistent with our terms of reference to indicate what these implications might be and what possibilities by way of offsetting action might be open to the authorities. It seems clear from that that the Board not only went beyond its terms of reference but was clear in its mind that it was doing so. It not only made recommendations but examined the much broader implications of those recommendations. The House is right to be jealous of this in considering the Amendment. There is no objection which the Government could legitimately have to the Amendment.

The position of the Opposition concerning the Prices and Incomes Board was clearly expressed by my right hon. Friend the Leader of the Opposition in a speech only last weekend when he said: Some restrictive practices would remain untouched by the measures which he mentioned earlier. He went on: These we will attack by adapting the instrument of the Aubrey Jones Board for that specific purpose. We will also use the power of Government spending to eradicate restrictive practices from the firms and industries which gain from public contracts". The Prices and Incomes Board has grown without any clear restraints on the form in which it should develop. For that reason it is important that the House should be jealous of its powers and should not delegate them to other quasi-judicial bodies such as this without considering and writing into legislation very carefully exactly what its powers should be.

8.0 p.m.

On the two previous occasions when the House decided to delegate powers in restrictive practices to outside bodies, a major Bill was introduced and debated in greatest detail and very severe restraints were placed on those two bodies. I refer to the Monopolies Commission and the Restrictive Practices Court. In debates on the Monopolies Commission—when it was first set up and when it has been changed in successive legislation—it has been made clear that the powers of the Commission are substantially less than those of the Jones Board. We were told when discussing an earlier Amendment that the Jones Board's references would restrict the extent to which the Government could take action in a particular case. The Monopolies Commission does not even have that power to limit the Government's control and it has been hemmed around with such severe restraints as the House has considered it right to put on the Commission.

Similarly with the Restrictive Practices Court. Lengthy debates took place on exactly the subject of the powers which the Court should have and the extent to which it could judge maters which were not essentially judicial but were considered to have elements of public policy in them. In that case the House not only imposed rigorous controls, but said that certain practices might be against the public interest unless they could go through some specified gateway.

In this case, on the other hand, the National Board for Prices and Incomes has very little control over its operations. Apparently it is not even being tied down to its terms of reference. I hope, therefore, that the Government will accept the Amendment.

Some anxiety was expressed earlier about the Board employing consultants. It seems clear that the Board's terms of reference may not only be extended by the Board itself—as they were, apparently, in this case—but in some cases may even be extended by its consultants. The First Secretary asked my hon. Friends to give an example of a case where one of the Board's reports was produced not by the Board but by its consultants. Obviously we cannot give such an example. We appreciate that, in formal terms, its reports are produced by the Board. However, we have no means of telling how those reports diverge from the advice the Board has received from its consultants.

The First Secretary went on to say that we could be sure that none of the consultants had any particular interest which might enable him to be biased in his views. But the House cannot be sure of that. We do not know who the consultants are, or even their nationality—that is, unless an hon. Member tables a Question and learns this information in a Parliamentary Answer. It is not sufficient for the First Secretary to say, "This is a straightforward procedure. We know exactly what happens". The House has been given remarkably little information about what happens either about the working of the Board or its consultants. We need to be sure that they are tied down to their terms of reference.

We do not even have a clear idea of the terms of reference affecting the operation of the Board. In the other two cases to which I referred we know exactly what is happening. There are clear procedural recommendations applying to the Monopolies Commission and any case to be answered is clearly set out for those who are called upon to give information. They have a clear idea of the case that must be answered and they can put forward their evidence accordingly.

It is not clear that those being investigated by the Board have an equal right of reply. There is no public hearing to correspond with that of the Monopolies Commission, and the Restrictive Practices Court has an even more rigid procedure which protects the interests of those who are being investigated—certainly far more than people appearing before the Prices and Incomes Board are protected.

I take issue with my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor), who expressed the hope that the Board's operations would not be too closely restricted. The essential element is that the Board's terms of reference should be specified in such a way that it can reasonably investigate the matter in hand and spread its net as wide as the Government feel that it ought. However, it is unreasonable that the Government should give the Board one set of terms of reference and that the Board should go on to decide whether or not it should go beyond them.

In these circumstances, as in the banking case, the right course would be for the Board to say to the Government, "We feel it necessary to examine other matters"—of the kind mentioned by my hon. Friend the Member for Cathcart—"and presumably you will revise our terms of reference accordingly". But, instead, the Government have been remarkably loose in framing the Board's terms of reference, and this reflects the Government's general woolly thinking.

I will give two instances of this. Report No. 31, on the Distribution Costs of Fresh Fruit and Vegetables, states that the Government had reason to refer the matter to the Board and, accordingly, the Board was asked to examine … the question of the costs and profit margins of the wholesale and retail fruit and vegetable trades. The Government should also have said that the demand for those goods, the way it fluctuates daily, seasonal aspects and other problems, should be looked into. Then the Board would have known where it was. Instead, the Government specified one aspect of the matter and left ii to the Board to do the work which the Government should have done themselves.

Time and again the reference given to the Board has been nebulous, and when the Government have given a specific reference the Board has often gone beyond it. Consider the case of laundry and dry cleaning charges, the only case where an Order has been issued. The Government considered it desirable … in the national interest that the justification for increases in charges from the middle of 1964 should be investigated by the National Board for Prices and Incomes. The Board went far beyond that and made recommendations on which the Government imposed an Order. If that is what the Government wanted, they should have said clearly to the Board what was desired and asked for specific recommendations. This has a strong bearing on the last Amendment we were discussing.

The Government are anxious to leave the whole thing as woolly and nebulous as possible, with the Board's terms of reference being so ill-defined that nobody can make head or tail of them. The Government then hope that the Board will come up with something that they can either reject or accept, as they think fit. This is not a matter of little consequence. The House of Commons should not be treated in this way. In the other two instances the House went to immense trouble to define the powers of such quasi-judicial bodies. I trust that the Government will now accept the Amendment because there is clearly a case for defining the Board's whole operation, its structure, consultants and the basis on which its activities are conducted.

Mr. Frederick Lee

This has been a wide-ranging debate in which hon. Gentlemen opposite have expressed views about the way in which the National Board for Prices and Incomes interprets its terms of reference. I am not absolutely clear how this subject comes within the terms of the Amendment, or, indeed, of the Bill. After all, the Bill merely gives the Government powers to extend standstills and does not in any way, shape or form or discuss the terms of reference of the Board or give the Board power to go outside the terms of reference given it in the 1966 Act, which were explicit.

Hon. Gentlemen opposite will see that we are not in any way widening the Board's terms of reference. We are merely extending the time factor for delay, if the Board so recommends. The anxieties expressed by hon. Gentlemen opposite appear to be misplaced. Hon. Gentlemen opposite have contrasted a general reference, with fairly wide terms of reference, with more specific issues and have suggested that the Board might go wide in interpreting its terms of reference on the more general issues.

I would remind the House that we are discussing Clause 1. We know that it confers on the Government discretion to extend by Order, temporarily, a standstill of a price or pay increase beyond the three or four months provided for in Part II of the Act in cases where the Board have so recommended. The hon. Member for Worthing said that we were being woolly and nebulous, and were giving the Board powers that it could use too widely; that the Government was not limiting the Board. I will try to deal specifically with one or two items, because I want to disabuse the hon. Member of that idea.

By virtue of paragraph 2 of the Schedule the Government cannot take action which is more restrictive than that which the Board recommends. Whether the existing standstill has been imposed directly under Part II of the Act or by virtue of Clause 2 of the Bill it will operate in relation to the Board's reference on the particular price or pay increase in question.

We have been told that this Amendment is designed to ensure that a standstill cannot be extended by virtue of the Clause unless the Board's Report contains a recommendation that is adverse to the increase in price or charge, or the settlement, and which … arises from the terms of reference originally given to the Board". The hon. and learned Member for Darwen (Mr. Fletcher-Cooke), and other hon. Members, said that surely the Government could accept the Amendment, as it would do no harm in any event. I do not argue that the content of the Amendment is in any way harmful. The fact is that it is quite unnecessary. The point is covered time and again in the 1966 Act and in the Bill.

The Schedule makes it clear that the Government cannot impose anything wider than that which the Board recommends, whether it is done under Part II of the Act or Clause 2 of the Bill. That which the Board can recommend must relate to the specific reference given to it. Part II, or Clause 2 of the present Bill, can be effective only in relation to increases in prices or charges, awards or settlements to which the relevant reference to the Board applies.

Sections 7 and 14 deal with cases involving statutory notification of proposed increases in prices or pay. Sections 7(3) and 14(6) provide respectively for the reference to the Board of the notice of intention to increase the prices or charges, awards or settlements in question, as a prerequisite to the maintenance of the standstill. Again, Section 8(1) limits the application of the standstill to prices or charges and … matters to which the reference relates. Section 15(1) limits the application of a standstill to the award or settlement that has been referred to the Board.

It is pretty difficult in such circumstances to appreciate why hon. Members opposite believe that on specific references—the kinds of things that we discuss in Clause 1—the Board can rove far and wide outside the terms of reference. Indeed, the standstill powers contained in Clauses 1 and 3, like those in Part II of the 1966 Act, can be applied only to price increases and pay settlements referred to the Board, and only where the price increases or groups of workers are directly covered by the reference.

The hon. Member for Cathcart (Mr. Edward M. Taylor) was not far off the mark when he indicated that there could be certain limitations—

Mr. Frederic Harris (Croydon, North-West)

But my hon. Friends have, time and again, given very definite cases where the Board has roved widely.

8.15 p.m.

Mr. Lee

I have emphasised that this Bill as a whole does nothing to widen the powers of the Board; it merely extends the time factor.

The reference can only be directly either to a given price increase or to a specific group of workers, but this does not of itself stop the Board from making recommendations on related matters. The hon. Member for Cathcart indicated one or two such related matters. He talked in terms of relative rates for apprentices, or for one kind of craftsman when another kind of craftsman has received an increase. The hon. Gentleman is quite right—these things generally do run together. But no matter what the Board might say on issues like that, we could not use the powers to implement a recommendation that went wider than the actual group of workers to whom the reference related.

Therefore, it is not the case that in these specific references under Clause 1 the Board would go wider in its recommendations than its terms of reference unless, afterwards, we gave it a further reference to deal with other types of worker who were not under surveillance in the original terms of reference—

Mr. Peyton

The right hon. Gentleman now seems to envisage a rather messy postscript being given to the reference, but what we on this side have been concerned with—and he has just handed the case to us—is that a reference is made and the Board comes back with a recommendation which covers people who are not within the terms of reference. That recommendation would be very embarrassing to the Government. That was my hon. Friend's point.

Mr. Lee

The hon. Gentleman mistook reference for recommendation. I am talking, as was the hon. Member for Cathcart, in terms of a number of craftsmen working in a shipyard, engineering workshop, or the like, where there may have been a reference to one section—let us say, some kind of engineering job. By practice, movements of income as between those people and other comparable workers are generally kept in line. It tray well be that the reference merely relates narrowly to the one group of people to whom I have referred. Whilst in its Report, the Board could say that this rather got the thing out of balance, it would not be a recommendation on which we could act. If, however, the Board said that this got all the relativities out of balance we could make a further reference dealing with the specific people to whom the Board had made some reference in its report. To those of us not unused to that sort of thing in industry, there is nothing new or original in it, nor is there anything startling about it; in fact, it would he rather startling if there were not something like that.

I therefore hope that the apprehensions felt by such a wide number of hon. Members opposite will be assuaged when they read what I have said. I have given them some references both to the 1966 Act and to the Bill, including the Schedule to the Bill, in order to show them that it is not likely in these references under either Clause 1 or Clause 3 for the Board's recommendation to go outside their specific terms of reference; that, if it did so, the recommendation would carry no statutory weight whatever, and that before we could widen a standstill or an increase or anything else there would have to be a further reference to deal with other people outside those concerned in the original reference to the Board.

Mr. Iain Macleod

My hon. Friend the Mmber for Guildford (Mr. David Howell) moved this important Amendment with his usual clarity, but the clarity somewhat disappeared during the speech of the Chancellor of the Duchy of Lancaster to which we have just listened. The right hon. Gentleman seemed to have got hold of a remarkable brief, on one or two points of which I would like to comment.

The right hon. Gentleman began by casting doubt on whether the speeches were relevant to the Bill. I remind him that subsection (1) of Clause 1 begins by saying: Where by virtue of a reference to the National Board … Clearly, therefore, the questions of the reference and how much of it is intra vires and how much of it is ultra vires are of the greatest importance. My hon. Friends were distinctly worried—I certainly was—as the right hon. Gentleman's explanation went on—

Mr. Frederick Lee

The right hon. Gentleman began to quote from subsection (1). Will he finish it?

Mr. Macleod

Of course— Where by virtue of a reference to the National Board for Prices and Incomes under section 2(1) or (3) of the Prices and Incomes Act 1966 … [Interruption.] I can read the whole Bill if the First Secretary does not know it, but I suspect that he does, and he knows that I know it. Perhaps we can leave it at that. It is by virtue of a reference.

I join the alliance against my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward M. Taylor). I do not see the Board as a roving band of "whizz-kids". Some of the Members of the Board are distinguished people. Mr. Hilary Marquand, for instance, is difficult to envisage in that guise. This is in no sense an attack on the Board. I admire much of the work that it does and I have considerable regard in particular for the chairman, Mr. Aubrey Jones. The question is whether there should be, either at first or at second hand, a true measure of Parliamentary control—my hon. Friend the Member for Ormskirk (Sir D. Glover) put his finger on this—over the question of what is in a reference.

By far the most startling example was the one which was first referred to by my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) and also by my hon. Friend the Member for Worthing (Mr. T. Higgins)—that is, the the report on bank charges. I know of no evidence that there was widespread objection by the public to the level of servicing charges, but we can leave that aside for the moment. The key sentence for the reference was that published profits and dividends had increased substantially in recent years.

The report tries to justify that by showing that over the 13 years from 1951 to 1964, net profits and net dividends paid out increased by 3.7 and 3.9 times, respectively. All that arises out of the reference, and one can have no objection to it. The Board could, and, in my view, should, have gone on to say that in 1951, which it took as its base year, the Bank Rate was 2 per cent. and, therefore, the percentage of advances was subnormal. It should have said that for 20 years before then, from 1931 to 1951, dividends had been frozen, in some cases at levels made during the 1931 slump. At least, that was the Board's assignment and nobody can complain about that.

The Board could, on that point alone, have produced a quite short report had it adhered to its terms of reference. It makes clear in Chapter 6 of its report that 42 per cent. of private accounts pay no charges and that the overall average charge, remarkably enough—it surprised me very much—is only 44s. a year, which is scarcely an important item in most people's cost of living.

The Board could, and, in my judgment, should, have stopped, I will not necessarily say there, but either there or there-abouts. If anything, it had discharged fully the terms of reference given to it and it had found that the commission charges were subsidised from other profits and were being provided by the banks at less than cost. That could, hand should, have been the end of the matter.

Now comes the point which causes us concern. My hon. Friend the Member for Worthing quoted the key sentence from page 3 of the report. It is clear that what the Board went on to do was absurdly distant and different from its terms of reference. In paragraph 176 it stated that the Government was inviting us in effect to judge whether the depositor and the borrower had been equitably dealt with vis-à-vis the shareholder. I do not believe that the Government were doing any such thing. It is an extraordinary interpretation of the terms of reference.

At that point in his speech, the Chancellor of the Duchy argued that the Board cannot go outside its terms of reference. The short answer is that it goes outside them over and over again. We are picking only on the most obvious and the most recent of a number of examples. The Chancellor of the Duchy then said that no further action could be taken by the Government if the Board went outside its terms of reference because it was stopped from doing so by one of the provisions in the Schedule to the Bill.

I should like to ask this question. If the First Secretary is not thinking of replying to the debate, perhaps he can reply in one word. When the Board went, in my view, outwith its terms of reference, did it ask the Government whether it could do this, or was the Board simply interpreting to its own satisfaction the terms of reference which had been given to it? Was the First Secretary asked by the Board, "Can we go wider than these terms of reference", or was the Board, in the exercise of its private initiative, simply extending, in our view at least, the terms of reference which had been laid down for it by the Secretary of State? Would the First Secretary like to deal with this by intervention now or later?

Mr. M. Stewart

Later.

Mr. Macleod

Very well. In my view, it is beyond argument that had the Board wanted to do that, it should have come back to the Secretary of State and said—this is not uncommon; we all have experience of this, those of us who have held ministerial office and, indeed, those who have not—"Should we go beyond the immediate terms of reference?" It is on this point that the question of the authority of Parliament, which my hon. Friend the Member for Ormskirk raised, is of real importance. We should be jealous of our position in this matter.

The Chancellor of the Duchy of Lancaster said that if the report of the Board went beyond its original terms of reference, there was no action that the Government should take in the matter. Perhaps the First Secretary will explain this point. I have not got the reference with me, but it is clearly in my mind that the First Secretary welcomed the full report on the banking industry when it was issued, which seems to me to be in considerable contrast with the attitude of the Chancellor of the Duchy of Lancaster, who has said, in effect, that the Board was wasting its time by going beyond the terms of reference given to it by the First Secretary.

Mr. Frederick Lee

I was old-fashioned enough to be arguing an Amendment to Clause 1. Clause 1 gives the power to extend periods of standstill. I was therefore saying that the terms of reference are very different from the kind of thing the right hon. Gentleman is discussing.

8.30 p.m.

Mr. Macleod

I have got that. I left that point about a quarter of an hour ago. I entirely accept what the right hon. Gentleman says, but all of Clause 1 is governed by the opening words: Where by virtue of a reference and then we go on with this matter.

The Chancellor of the Duchy of Lancaster claimed at the end that the Amendment was unnecessary. He knows tie standard answer to that, which I dare say he leas given me in his time. If it is unnecessary, why not put it in, because at least this side of the House would be satisfied, a vote would be saved, and we should be a good deal clearer on a matter which touches on the heart of the Bill?

The terms of reference which the First Secretary gives will, as he knows full well, in some cases at least have the effect of putting a firm or an industry, or even conceivably an individual, although this has not happened so far, in the dock. It has to explain all sorts of things. It may be, and often is, extremely dissatisfied with the result. In the same way as anyone who has to face any sort of charge or investigation into his affairs—business affairs or other affairs, as the case may be—is always told specifically what the charges are against him and what will be investigated, so we seek to write into the Clause words which we think would have that effect. Of course the First Secretary would be able to continue to make references by virtue of the 1966 Act and the standstill in due course, when Parliament has finished discussing this, will no doubt be extended by the Clause.

We regard this as one of the most important points in the Bill. We regard it as very important indeed that the Board should not charge all over the countryside on all sorts of matters which may conceivably seem to it to arise at first or second or tenth hand from the reference which has been given to it by the First Secretary. We therefore seek deliberately to narrow the Board's reports to matters which arise from the terms of reference originally given to the Board". We naturally think that this is a bad Bill. We think that the parent Act is a bad one, too. We think that an important change would be made for the better if the First Secretary were to accept the Amendment.

Mr. M. Stewart

I will try to explain to the right hon. Gentleman not only why the Amendment is unnecessary but why its acceptance would make the Bill a worse Bill. The hon. Member for Guildford (Mr. David Howell) was much interested in what has sometimes been called general references to the Board. He instanced productivity agreements and restrictive practices. The hon. Member for Glasgow, Cathcart (Mr. Edward M. Taylor), as one of the limited number of trade unionists on the Opposition benches, may have noticed the zeal amongst his colleagues for having restrictive practices investigated by the Board and the great alarm that possibly a banker might be upset by something the Board had said. He will notice this kind of thing more and more as he remains on those benches.

I come to the important point about the fondness of the hon. Member for Guildford—it is a fondness which I share—for general references of important questions to the Board. I think we must accept that, long term, this will be an important part of the Board's work—not just to be asked, "Ought this group of workers to have so many shillings per week more?" but to consider wider questions. It is common ground that the Board ought to have general as well as particular references. It could never do a useful job such as that which it has done on productivity agreements if an attempt were made to tie down its terms of reference as narrowly as the hon. Gentleman tried to tie down what the hon. Gentleman the Member for Worthing thought the terms of the fruit and vegetable reference should have been. A study of the report of his speech in HANSARD and of the way in which he said that we should have pegged down the reference about fruit and vegetables will show that it would have left the Board with nothing to do. The Government would have told the Board not only what they wanted done but exactly, at every stage, how they thought it should be done.

Mr. Higgins

No, not at every stage how they thought it should be done. All the Government should be doing is giving the Board clear terms of reference. The right hon. Gentleman is now saying that the Government are incapable of giving clear terms of reference.

Mr. Stewart

No. If the hon. Gentleman reads what he said, he will see that that would be treating the Board like a child, giving it terms of reference nailed down in that way. If we did that, the Board would never do the kind of job which the hon. Member for Guildford rightly wants to see it do. I make that general point with regard to terms of reference given to the Board.

I come now to some of the accusations made against the Board. I expect that the hon. Gentleman the Member for Ormskirk (Sir D. Glover) has from time to time in his Parliamentary work asked someone not in the House but with special knowledge to give him advice before he made a speech on some matter. Has he never done that? What would he say if it were then alleged that his speech was produced by outside advisers? That is the sort of accusation which he was making against the Board, without a shadow of evidence.

Sir D. Glover

The right hon. Gentleman is taking this too far. I gave a very generous apology. The right hon. Gentleman said that there was no truth in my allegation. Since then, he and his right hon. Friend have told me that there was a good deal of truth in my allegation and, in fact, specialists were consulted. There is not much point in consulting if one takes no notice of the people consulted.

Mr. Stewart

The hon. Gentleman is trying to have it both ways. No one disputes that the Board takes advice, as, occasionally, I imagine, the hon. Gentleman does, but that is not to say that its reports are produced for it by someone else. That accusation ought not to have been made, yet the hon. Gentleman is now trying to repeat it through the back door. I mention those matters since this general argument about the Board has been brought up.

If hon. Members opposite want to pursue this interesting and important question of how references to the Board should be drafted and the two kinds of work of the Board are to be undertaken, the particular reference and the general question—I think that it has to do both—they will need to devote a little more thought to the matter than they have shown by their contributions tonight, and they will have to be a little less influenced by purely malicious attacks on the Board.

Mr. David Howell rose—

Mr. Stewart

No. I think that I need say no more about that because none of it has anything to do with the Amendment before us. Even if every accusation made against the Board in this debate, with or without evidence, were true, there is nothing in the Amendment which would reduce the Board's power to do any of the things complained of. The hon. Member for Worthing thought that the Board went outside its terms of reference in regard to the banks. He said that that was the view on his side of the House. It is not everyone's view. It is a matter about which, on the words of the reference, different opinions can be held. But even if he is right, even if the Board did go outside its terms of reference, there is nothing in the Amendment which would prevent it doing so again. The Amendment is not directed to that problem at all.

What is the Amendment supposed to do? The right hon. Member for Enfield, West (Mr. Iain Macleod) recommended the Amendment to us as one which would stop what he would regard as a dangerous abuse of the rights of Parliament. The Amendment would do nothing of the kind. It does not bear on that problem at all. What would it do? It would provide that, if the Board went beyond its terms of reference, the Minister could not make an order on any matter on which it had gone outside its terms of reference. I agree that that is a proper provision to have in the Bill. It is there already. The Bill is concerned with prolonging standstills provided for under the 1966 Act, and those standstills can arise only out of a particular reference to the Board.

If the Amendment were carried, therefore, the Board's powers to interpret its terms of reference as it judged best would remain where they are. The Minister's incapacity to make Orders about things which are not in the terms of reference to the Board would remain as it is. If this is meant to be an Amendment disciplining the Board, it quite clearly fails in its objective. If it is intended to limit the powers of Ministers, it is unnecessary and it has this further peculiar result that the words: … the terms of reference originally given to the Board might leave the courts wondering what would be the position if, under the Prices and Incomes Act, 1966, the reference was given to the Board and later on was varied. As the first reference is known as the original reference, the courts might be genuinely left wondering whether, if that happened, the Board could only report, and the Government only act on the original terms of reference, and not the original reference as varied.

A large part of the argument for this Amendment has been directed to a matter with which the Amendment does not deal. It is an Amendment which is said to be due to a fear of excessive powers of Ministers, yet it does not limit those powers. They are already limited. It has the final disadvantage that it might leave the courts in some doubt as to what it meant. The House will be well advised rot to accept it.

Mr. Higgins

On the second point that the right hon. Gentleman was making, that the Amendment does not limit the Government, are we to understand that what he is now saying is that the Governmen would not be able to take any action under this Clause at all, unless they were acting in precisely the terms specified in the terms of reference of the Board?

Mr. Stewart

The Goverment's powers are to prolong a standstill, of either prices or wages. They can only do that on proposals about prices or wages which have been referred to the Board. This kind of reference would be a particular reference, about particular prices or wages. It would not be possible for the Government to go beyond that. The Board might choose—and it might be right to choose in my judgment—to include in its report certain opinions about main matters, but that would not enlarge the powers of the Government.

Mr. Iain Macleod

Leaving on one side the question whether the courts will be in some doubt, the right hon. Gentleman might like to recall the recent decision of the Court of Appeal in this matter, which shows fairly clearly that the Government are wrong in their legal views in these cases. I asked the right hon. Gentleman one specific question which he promised to answer. Did the Board come back to him?

Mr. Stewart

The right hon. Gentleman knows that the decision of the Court of Appeal is not in the least connected with this Amendment. I am merely pointing out that the words in this Amendment would only create further ambiguity for the courts.

The answer to the right hon. Gentleman's question is, "No". It does not, and I cannot see why it is necessary to do so. If hon. Members look at the wording of the terms of reference, the Board could quite properly hold that its report was within the terms of reference. Interesting as it is, this question has no bearing on the Amendment.

Mr. Frederic Harris

I have listened to every part of this very interesting debate and I am tempted to make a few comments because every time I listen to the First Secretary he comes out with some offensive and irritating remark. In this case the Chancellor of the Duchy of Lancaster made a strong and rather complicated argument, but said clearly that it was in order to accept the Amendment, that there was no difficulty about it, but that it was felt to be unnecessary.

On the other hand, the First Secretary gets up and gives us a long-drawn-out story as to why the Amendment cannot be accepted under any circumstances. An ordinary layman, trying to understand Amendments to a most complex Bill such as this, should be able, at least, to expect that the two main Ministers concerned would have made up their minds as to what they would do about this. These are the facts and they cannot be denied. I strongly recommend the two Ministers to get together before we go on to the rest of the Amendments and come to some understanding about what they are recommending to the House. Whose advice do we take?

8.45 p.m.

My right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), when he intervened, said exactly what I was going to say in very much better language, and the House will be pleased to know that I am now going to sit down and leave it to the Division.

Question put: That those words be there inserted in the Bill:—

The House divided: Ayes 143, Noes 209.

Division No. 430.]	AYES	[8.46 p.m.
Alison, Michael (Barkston Ash)	Gurden, Harold	Murton, Oscar
Allason, James (Hemel Hempstead)	Harris, Frederic (Croydon, N.W.)	Noble, Rt. Hn. Michael
Astor, John	Harris, Reader (Heston)	Page, Graham (Crosby)
Atkins, Humphrey (M't'n & M'd'n)	Harvie Anderson, Miss	Page, John (Harrow, W.)
Barber, Rt. Hn. Anthony	Hawkins, Paul	Pardoe, John
Beamish, Col. Sir Tufton	Heald, Rt. Hn. Sir Lionel	Peel, John
Biffen, John	Heseltine, Michael	Percival, Ian
Boyle, Rt. Hn. Sir Edward	Higgins, Terence L.	Peyton, John
Braine, Bernard	Hiley, Joseph	Pink, R. Bonner
Brewis, John	Hirst, Geoffrey	Prior, J. M. L.
Bromley-Davenport, Lt.-Col. Sir Walter	Hogg, Rt. Hn. Quintin	Pym, Francis
Brown, Sir Edward (Bath)	Holland, Philip	Ramsden, Rt. Hn. James
Bruce-Gardyne, J.	Hooson, Emlyn	Renton, Rt. Hn. Sir David
Bullus, Sir Eric	Hordern, Peter	Ridley, Hn. Nicholas
Burden, F. A.	Hornby, Richard	Royle, Anthony
Campbell, Gordon	Howell, David (Guildford)	Russell, Sir Ronald
Carlisle, Mark	Hunt, John	Scott, Nicholas
Carr, Rt. Hn. Robert	Hutchison, Michael Clark	Sharples, Richard
Chichester-Clark, R.	Iremonger, T. L.	Shaw, Michael (Sc'b'gh & Whitby)
Clegg, Walter	Irvine, Bryant Godman (Rye)	Sinclair, Sir George
Cooper-Key, Sir Neill	Jenkin, Patrick (Woodford)	Steel, David (Roxburgh)
Corfield, F. V.	Jennings, J. C. (Burton)	Stoddart-Scott, Col. Sir M. (Ripon)
Costain, A. P.	Johnson Smith, G. (E. Grinstead)	Summers, Sir Spencer
Craddock, Sir Beresford (Spelthorne)	Jopling, Michael	Tapsell, Peter
Crosthwaite-Eyre, Sir Oliver	Kaberry, Sir Donald	Taylor, Sir Charles (Eastbourne)
Crouch, David	Kimball, Marcus	Taylor, Edward M.(G'gow, Cathcart)
Dance, James	King, Evelyn (Dorset, S.)	Taylor, Frank (Moss Side)
Davidson, James(Aberdeenshire, W.)	Kirk, Peter	Temple, John M.
Dean, Paul (Somerset, N.)	Knight, Mrs. Jill	Thatcher, Mrs. Margaret
Deedes, Rt. Hn. W. F. (Ashford)	Lambton, Viscount	Tilney, John
Dodds-Parker, Douglas	Leadbitter, Ted	Turton, Rt. Hn. R. H.
Eden, Sir John	Lewis, Kenneth (Rutland)	van Straubenzee, W. R.
Elliott, R.W.(N'c'tle-upon-Tyne, N.)	Loveys, W. H.	Wainwright, Richard (Colne Valley)
Emery, Peter	Lubbock, Eric	Walker-Smith, Rt. Hn. Sir Derek
Errington, Sir Eric	McAdden, Sir Stephen	Walters, Dennis
Eyre, Reginald	MacArthur, Ian	Ward, Dame Irene
Fisher, Nigel	Macleod, Rt. Hn. Iain	Weatherill, Bernard
Fletcher-Cooke, Charles	McMaster, Stanley	Webster, David
Fortescue, Tim	Maude, Angus	Whitelaw, Rt. Hn. William
Fraser, Rt. Hn. Hugh(St'fford & Stone)	Mawby, Ray	Wills, Sir Gerald (Bridgwater)
Galbraith, Hon. T. G.	Maxwell-Hyslop, R. J.	Wilson, Geoffrey (Truro)
Gilmour, Sir John (Fife, E.)	Maydon, Lt.-Cmdr. S. L. C.	Wolrige-Gordon, Patrick
Glover, Sir Douglas	Mills, Peter (Torrington)	Wood, Rt. Hn. Richard
Glyn, Sir Richard	Miscampbell, Norman	Wright, Esmond
Gower, Raymond	Mitchell, David (Basingstoke)	Wylie, N. R.
Grant, Anthony	Morgan, Geraint (Denbigh)
Grant-Ferris, R.	Morrison, Charles (Devizes)	TELLERS FOR THE AYES:
Griffiths, Eldon (Bury St. Edmunds)	Mott-Radclyffe, Sir Charles	Mr. Jasper More and
Grimond, Rt. Hn. J.	Munro-Lucas-Tooth, Sir Hugh	Mr. Timothy Kitson.
NOES
Abse, Leo	Beaney, Alan	Bradley, Tom
Alldritt, Walter	Bence, Cyril	Bray, Dr. Jeremy
Ashley, Jack	Benn, Rt. Hn. Anthony Wedgwood	Brooks, Edwin
Atkins, Ronald (Preston, N.)	Bidwell, Sydney	Brown, Bob(N'c'tle-upon-Tyne, W.)
Atkinson, Norman (Tottenham)	Bishop, E. S.	Brown, R. W. (Shoreditch & F'bury)
Bacon, Rt. Hn. Alice	Blackburn, F.	Buchan, Norman
Bagier, Gordon A. T.	Boardman, H.	Buchanan, Richard (G'gow, Sp'burn)
Barnes, Michael	Bowden, Rt. Hn. Herbert	Butler, Herbert (Hackney, C.)
Baxter, William	Braddock, Mrs. E. M.	Callaghan, Rt. Hn. James
Carmichael Neil	Henig, Stanley	Oakes, Gordon
Castle, Rt. Hn. Barbara	Herbison, Rt. Hn. Margaret	Ogden, Eric
Coe, Denis	Hooley, Frank	O'Malley, Brian
Coleman, Donald	Houghton, Rt. Hn. Douglas	Orbach, Maurice
Conlan, Bernard	Howarth, Harry (Wellingborough)	Orme, Stanley
Craddock, George (Bradford, S.)	Howarth, Robert (Bolton, E.)	Owen, Dr. David (Plymouth, S'tn)
Crawshaw, Richard	Howell, Denis (Small Heath)	Owen, Will (Morpeth)
Cronin, John	Howie, W.	Page, Derek (King's Lynn)
Crosland, Rt. Hn. Anthony	Hoy, James	Pannell, Rt. Hn. Charles
Crossman, Rt. Hn. Richard	Huckfield, L.	Parker, John (Dagenham)
Cullen, Mrs. Alice	Hughes, Hector (Aberdeen, N.)	Parkyn, Brian (Bedford)
Dalyell, Tam	Hughes, Roy (Newport)	Pavitt, Laurence
Davidson, Arthur (Accrington)	Hunter, Adam	Pearson, Arthur (Pontypridd)
Davies, G. Elfed (Rhondda, E.)	Hynd, John	Peart, Rt. Hn. Fred
Davies, Harold (Leek)	Jackson, Colin (B'h'se & Spenb'gh)	Pentland, Norman
Davies, Ifor (Gower)	Jay, Rt. Hn, Douglas	Perry, George H. (Nottingham, S.)
Davies, S. O. (Merthyr)	Jeger, Mrs. Lena(H'b'n&St.P'cras, S.)	Price, Thomas (Westhoughton)
de Freitas, Rt. Hon. Sir Geoffrey	Jenkins, Hugh (Putney)	Rankin, John
Delargy, Hugh	Johnson, James (K'ston-on-Hull, W.)	Rees, Merlyn
Dell, Edmund	Jones, Dan (Burnley)	Roberts, Gwilym (Bedfordshire, S.)
Dempsey, James	Jones, Rt. Hn. SirElwyn(W. Ham, S.)	Robinson, W. O. J. (Walth'stow, E.)
Dewar, Donald	Jones, T. Alec (Rhondda, West)	Roebuck, Roy
Diamond, Rt. Hn. John	Judd, Frank	Rose, Paul
Doig, Peter	Kelley, Richard	Shaw, Arnold (Ilford, S.)
Dunn, James A.	Kerr, Russell (Feltham)	Short, Rt. Hn. Edward(N'c'tle-u-Tyne)
Dunwoody, Mrs. Gwyneth (Exeter)	Lawson, George	Short, Mrs. Renée(W'hampton, N.E.)
Dunwoody, Dr. John (F'th & C'b'e)	Leadbitter, Ted	Silkin, Rt. Hn. John (Deptford)
Eadie, Alex	Ledger, Ron	Silverman, Julius (Aston)
Edwards, Robert (Bilston)	Lee, Rt. Hn. Frederick (Newton)	Slater, Joseph
Ellis, John	Lee, John (Reading)	Small, William
English, Michael	Lewis, Ron (Carlisle)	Snow, Julian
Ennals, David	Lipton, Marcus	Spriggs, Leslie
Ensor, David	Lomas, Kenneth	Steele, Thomas (Dunbartonshire, W.)
Evans, Albert (Islington, S.W.)	Loughlin, Charles	Stewart, Rt. Hn. Michael
Evans, Ioan L. (Birm'h'm, Yardley)	Lyon, Alexander W. (York)	Summerskill, Hn. Dr. Shirley
Fernyhough, E.	Lyons, Edward (Bradford, E.)	Swingler, Stephen
Fletcher, Raymond (Ilkeston)	McBride, Neil	Thomas, George (Cardiff, W.)
Fletcher, Ted (Darlington)	McCann, John	Tinn, James
Foot, Michael (Ebbw Vale)	MacColl, James	Urwin, T. W.
Forrester, John	MacDermot, Niall	Wainwright, Edwin (Dearne Valley)
Fowler, Gerry	Mackenzie, Gregor (Rutherglen)	Walker, Harold (Doncaster)
Fraser, John (Norwood)	Mackintosh, John P.	Watkins, David (Consett)
Fraser, Rt. Hn. Tom (Hamilton)	Maclennan, Robert	Watkins, Tudor (Brecon & Radnor)
Freeson, Reginald	McMillan, Tom (Glasgow, C.)	Wellbeloved, James
Ginsburg, David	McNamara, J. Kevin	Wells, William (Walsall, N.)
Gordon Walker, Rt. Hon. P. C.	MacPherson, Malcolm	White, Mrs. Eirene
Gourlay, Harry	Mahon, Peter (Preston S.)	Whitlock, William
Gray, Dr. Hugh (Yarmouth)	Mallalieu,J. P. W.(Huddersfield,E.)	Willey, Rt. Hn. Frederick
Gregory, Arnold	Manuel, Archie	Williams, Alan (Swansea, W.)
Grey, Charles (Durham)	Mapp, Charles	Williams, Alan Lee (Hornchurch)
Griffiths, Will (Exchange)	Marquand, David	Williams, Mrs. Shirley (Hitchln)
Hamilton, James (Bothwell)	Mason, Roy	Williams, W. T. (Warrington)
Hamilton, William (Fife, W.)	Mellish, Robert	Willis, George (Edinburgh, E.)
Hamling, William	Mendelson, J. J.	Wilson, Rt. Hn. Harold (Huyton)
Hannan, William	Millan, Bruce	Wilson, William (Coventry, S.)
Harper, Joseph	Miller, Dr. M. S.	Winterbottom, R. E.
Harrison, Walter (Wakefield)	Milne, Edward (Blyth)	Woodburn, Rt. Hn. A.
Hart, Mrs. Judith	Morris, Charles R. (Openshaw)	Woof, Robert
Haseldine, Norman	Morris, John (Aberavon)	TELLERS FOR THE NOES:
Hattersley, Roy	Murray, Albert	Mr. Alan Fitch and
Hazell, Bert	Newene, Stan	Mr. Ernest Armstrong.
Heffer, Eric S.	Noel-Baker, Rt. Hn. Philip(Derby, S.)

Mr. Iain Macleod

I beg to move Amendment No. 11, in page 2, line 9, at the end to insert: 'or until 11th August 1968 whichever is the earlier'. The side heading of the Clause, on which we have had some discussion recently, is, "Power to extend periods of standstill under Part II of Prices and Incomes Act 1966."

Part II is not yet in operation, but it will be presumably when an Order on the Notice Paper is approved, if it is, by Parliament. It therefore follows that we are doubly against the Clause, against the original 1966 Act, and against the power that Clause 1 takes to extend it.

Subsection (2,a) of Clause I allows the standstill provision to continue … for a period ending ten days after the date of publication of the Board's report …". Subsection (2,b), to which we seek to add words, lays down that if notice is so given then the Secretary of State can direct by Order for a period up to six months. We wish to cut off this period at the date of 11th August, 1968, a year from the expiry of Part IV.

One of the main reasons why we seek to do this is that we have become more and more convinced—and there is a great deal of mounting evidence—that the Government have no intention of relinquishing powers in the real sense of the word this August, next August or any other August. What they do will vary. Part IV will come to an end, but, as I prophesied many months ago, something almost equally unattractive—the extended Part take its place. It is true—and this matter was exhaustively discussed in Committee—that this Bill will expire, but the original powers available to the Government under the permanent legislation of 1966 will go on.

I dare say that we will have another schoolmasterly lecture from the First Secretary of State, as on the last occasion, either about drafting or about the meaning of the words. My reference to the courts was not that I thought it directly related to the last Amendment, but simply to suggest to the First Secretary of State that he is not the best person to talk about dubiety in the courts in relation to the Prices and Incomes Act, because the Court of Appeal has found, as we warned it would long ago, that the main provision of Section 29 does not mean what he and presumably the Attorney-General, who no doubt advised him, thought it meant.

We have no reason to put any confidence in the words of the Government. The first reason for this is a statement made by the Prime Minister, which has been quoted on a number of occasions, when he was asked on B.B.C.1 on the programme "24-Hours" When the powers of the Act come to an end in August, Prime Minister, won't there have to be a continuation of them?", to which the Prime Minister replied, In terms of legislative powers, no. It is clear that the Bill extends the legislative powers with regard to the control of prices and that it goes far beyond the period of Part IV, which, we were assured, was to be a temporary measure, and there is no assurance that this so-called temporary measure will not be extended again and again and again until this Parliament in due course comes to an end. The Prime Minister has gone back on what he clearly said to the nation in that quotation which I have just given.

9.0 p.m.

My second point—I distinguish my first and my third; the second relates to the First Secretary and is in no sense an accusation of breach of faith as the first certainly is—relates to a matter which I should now like to clear up. The First Secretary will remember making a statement on powers on 17th April and he will remember a number of questions which I put to him designed to elicit from him an admission that these powers were really not for 12 but for 18 months. I said: Secondly, it is now quite clear that this is an extension not for 12 months, but for 18 months. That is to say, on the last day or so of a year to which the proposals relate, the First Secretary could make as many references as he wished. The First Secretary replied: When the right hon. Gentleman says 18 months I think that he is adding together two things which are not in the same category. He went on to say: The purpose of the arrangement that the Order can continue after the powers have lapsed is to see that the six months' power of delay does not operate unequally in one case or another."—[OFFICIAL REPORT, 17th April, 1967; Vol. 745, c. 94–5.] I should be grateful if the right hon. Gentleman would clear that up.

I do not think that I put together two matters which were not in the same category. In any case, is the point I made valid or not? Is it possible for the First Secretary to make as many Orders as he wishes within weeks, or days, or hours, of the expiry of the Bill? Could such Orders go on for a further six months? If so, is it not abundantly clear that in fact the powers which are here being taken are not for 12, but for 18 months, and that the House ought to judge them accordingly?

Mr. Eric S. Heffer (Liverpool, Walton)

Will the right hon. Gentleman explain something? In his earlier statement he was talking about prices. Am I to assume that if this proposal applied only to prices, he would oppose it, but that if it applied to wages, he would be quite happy about it?

Mr. Macleod

I am against these powers both for wages and prices. I do not understand the hon. Gentleman and I will gladly give way if he wants to intervene again. However, that was the subject of an earlier debate and is not now the issue before us. In short, I am against everything in the Bill.

The third matter is the speech, to which we must refer, which was made by the Loader of the House over the weekend. It surprised people very much, because it was exactly the point of the Amendment. Can we trust the Government to bring these powers to an end in due course, as they say they will? I know of one statement issued today by the Labour Party and purporting to correct the account of the speech of the Leader of the House. I am told that another pigeon is on its way, or on the tape, which I have not seen. I can deal only with the first correction.

The first correction says: Nowhere in the speech did Mr. Crossman either say or imply that the Government is contemplating a return to compulsory wage restraint under any circumstances whatever. On the contrary, his theme was the temporary character of July, 1966, measures and the Government's recognition of the need to make the voluntary system work …". The Press Association, who reported this speech—the correspondent was Mr. Binnersley, a reporter of the highest repute—has published his full shorthand note of what the Leader of the House said, and perhaps I might quote this sentence: Now we have Part IV coming off and, if they fail to do it voluntarily, then exactly the same thing will happen again. This is hard, economic fact. I do not see how the Leader of the House can for a second pretend that he was saying anything other than that if the T.U.C., the C.B.I., and the rest of us do not behave ourselves Part IV is coming back. This is the only conceivable meaning of his speech, and it is for this reason that we distrust the Government so much. It is for this reason that when we hear these speeches made and reported over the weekend we do not believe that the Government intend to give up the powers which they have, or, rather, if they give those up, that they will not take something equally unpleasant in their place.

I have one more quotation from the right hon. Gentleman's speech: We never want to let things get to the plight they got to last time, when we had wages soaring ahead and productivity dragging behind. We have to face the fact that if it happens again and economic forces reassert themselves, the same sort of medicine would have to be given to the people. What on earth does that mean, except that Part IV is coming back in certain circumstances, and all the assurances given by the Prime Minister and everybody else are worthless? Either that, or the speech of the Leader of the House is worthless, and the First Secretary will no doubt select which of those interpretations he wishes to offer to the House in due course.

Mr. Atkinson

I hope that we can have the Leader of the House present in a moment to clear up this question. According to the tape, the denial which the Leader of the House has made is that his words did not apply to Part IV, but to the word "unemployment" and he has asked the nation to believe that it should read "unemployment" for the term "Part IV".

Mr. Macleod

This is very interesting. I think that the Leader of the House ought to come here. I have been Leader of the House. There are means of conveying this message, and I would be grateful if it was conveyed to the Leader of the House that both sides of the House, with the exception of the Government Front Bench, desire his presence for this debate.

I take up the point raised by the hon. Member for Tottenham (Mr. Atkinson) about whether the Leader of the House did, or did not, mean Part IV. All that I can do is to quote the sentence again from the shorthand note of the right hon. Gentleman's speech: Now we have Part IV coming off and, if they fail to do it voluntarily, then exactly the same thing will happen again. It is not a question of my reading the words "Part IV" into his speech. They are there, and they were taken down by a shorthand writer of the very highest repute. The right hon. Gentleman really must explain this matter.

Our case about the Bill is that it has been an unrelieved failure from the beginning and the sooner the curtain comes down on it the better. It has had very little effect indeed on prices, and, as we showed in an earlier debate, the record since last July is on the whole worse than the annual record over the last ten years. Its effect on wages during the period of the freeze itself was fairly dramatic. But even on the evidence given, or the prophesies made, by the Government Front Bench we can expect that the increase in wages will be at least as high as that in the previous cycle over which my right hon. and learned Friend the Member for Wirral (Mr. Selwyn Lloyd) presided.

Some of these matters are perhaps more appropriate to go into on Third Reading, and in due course we shall vote against that. At the moment we are on the special point of the Amendment. We would like to bring the Bill and this subsection to an end as soon as we reasonably can. I think that I have shown that we—and not only we but the House as a whole and the country as a whole—have little reason to believe the statements of intent made by at least some of Her Majesty's Ministers. We have no reason to believe that when this new Part II disappears, as no doubt it will, it will not come back again.

We have had words in the clearest terms from the Leader of the House, which I have just quoted and which he owes a duty to the House to explain in the House and not by a series of different messages on the tape, which I gather is what is now happening.

I have moved this Amendment. There is another Amendment which has not been selected and which would equally have the effect of shortening the period which we are considering. We should like to insert words into the Bill which, in itself, gives power to extend the period of standstill under Part II of the principal Act, and we take the view that under no circumstances should these powers continue beyond 11th August, 1968.

Mr. Stanley Orme (Salford, West)

Many hon. Members on this side of the House are extremely concerned about when and how these Measures will terminate. From the statements made by the Government it seems that we are now in a transitional stage between the first Measure and the voluntary system, in terms of this Bill, and that as Part IV of the principal Act comes to an end on 11th August we shall be in a completely voluntary era.

Much of the Government's case has been based on this assumption. I have had the advantage of listening to George Woodcock and other responsible leaders of the T.U.C., and it is apparent that their interpretation of Government policy is that this Measure merely allows the Government to have a long-stop—although some of us will give it another name. It is a let-out for the Government's change of policy, but it is a welcome change away from compulsion to the voluntary system.

Unfortunately, whenever we seem to be going along that road something happens to cause consternation. The right hon. Member for Enfield, West (Mr. Iain Macleod) has referred to the speech made by my right hon. Friend the Leader of the House, and I also wish to refer to it. I have notified my right hon. Friend that I intended to raise the question. Many of us are concerned that, at a time when we are trying to achieve a general acceptance of the voluntary system, threats are made of administering the same sort of medicine as before, and the use of compulsory powers and a return to something akin to Part IV, of which we now hope to see the end.

9.15 p.m.

I have not seen the statement on the tape, but, during the passage of the Bill, the Leader of the House owes us a clarification of his statement. If he has been badly misreported, it is here that he should make his position clear. This statement can only cause consternation and problems with the trade union movement and queries about whether Government statements of their stand on compulsion mean anything and can be relied upon.

I object to the fact that we are told that compulsion is out and we are moving into a voluntary period, as I do not know how that is possible with compulsion overhead. But this seems to be the way the Government are working. The statement by the Leader of the House is retrogressive in relation to the Bill, and the extension provisions and the Amendment would lay down clearly that the Bill would end on that date and could not be extended without a fresh Bill—

Sir Edward Brown (Bath)

We who were on the Committee put this as a direct question to the First Secretary, whether a policy document would be published before or after 11th August, and he never gave a clear reply. Perhaps the hon. Gentleman should ask his right hon. Friend for this assurance, as he can give it.

Mr. Orme

I should have liked to have made these remarks to my right hon. Friend in Committee, but I never saw that Committee. The minority point of view was never democratically represented, and many of us resent that. I hope that the First Secretary will give us a clear assurance, because whatever his right hon. Friend has said outside, he is responsible for legislation here. But I think that my right hon. Friend has already raised this matter.

We are entitled to know, because I was under the clear impression that the Bill would end on 11th August, 1968, and much of the Government's policy is based on that presumption. If there are conflicting statements by other Members of the Government, that can only do harm to the voluntary system, to which both they and we attach importance. Therefore, I want a categorical assurance on that point.

Mr. John Biffen (Oswestry)

My right hon. Friend the Member for Enfield, West (Mr. Iain Macleod) has moved an Amendment of very considerable significance. As the hon. Member for Salford, West (Mr. Orme) rightly appreciates, this is a test of the good faith and good intentions of the Government to move towards a voluntary prices and incomes policy—if such an animal exists. I am prepared to accept the definitions of the Government that such an animal does exist. I should be out of order if I were to think otherwise. The question whether the Bill is a bridge away from a compulsory system as embodied in the Prices and Incomes Act to a voluntary system calls from hon. Members a degree of credulity which has been severely strained over the weekend.

The proposition throughout on the Bill is that it is a bridge not only in terms of legislation but, even more im- portant, in terms of time, and it is in that respect that the Amendment is so significant. It is a bridge towards some other system of determining price and income.

In Committee, on which I was privileged to serve and where I sadly missed, as all of us in the Opposition did, the assistance of the hon. Member for Salford, West, the First Secretary of State commented: I described on Second Reading how the country had to move from the fully voluntary Statement of Intent to the undoubtedly stringent powers of Part IV. We are now moving in the opposite direction, towards a voluntary system."—[OFFICIAL REPORT, Standing Committee A, 20th June, 1967; c. 44.] Anyone who has followed the Government's activities in pursuit of their prices and incomes policy has, of necessity, to become an acute student of semantics. It was in the pursuit of that art that my right hon. Friend the Member for Enfield, West undoubtedly felt it necessary to table an Amendment determining, in this specific form, the date on which these powers should terminate. But in pursuing that art, I invite hon. Members opposite—and I know that the hon. Member for Salford, West is a keen student of these affairs—to reflect on the two sentences which I have quoted from the speech of the First Secretary. What existed before Part IV was, apparently, a "fully voluntary" system. Those are the adjectives adjoined to the Statement of Intent. We now move towards not a "fully voluntary" system but the "voluntary" system.

I would normally think that this was an absurd, almost mediaeval theological discussion were it not for the fact that we are constantly told that we are moving towards a voluntary system, but not a fully voluntary system. That is the system we abandoned. During one of the nocturnal discussions which we had on various Orders laid under Part IV, I remember the hon. Member for Liverpool, Walton (Mr. Heller) describing how the voluntary system which was apparently being pursued was of the voluntary nature of the sergeant major's request—and how right he was, and how right he is under the legislation and Amendment which we are considering.

We all know that the Leader of the House was employed during the war in psychological warfare. That is a warning, if ever one was needed, to all of us to examine and weigh every calculated word very carefully. The Leader of the House talks of selfish trade unionists—never of selfish intellectuals, presumably—and we will have a chance to debate that on a later Amendment. Meanwhile, the matter at stake in the Amendment is of immense significance because if the Government wish to demonstrate that they want to return to the system that existed before Part IV, they would surely interrupt me now and say, "That is our intention. We accept the Amendment as a token of our conviction and determination to revert to the situation that existed before the prices and incomes legislation of last year".

But that is not what the Government intend at all. They will reject the Amendment because they want these powers and will find an excuse to use them. The seamen blew them off course last year and enabled them to rationalise their instinctive yearning to control prices and incomes through the legislative system. No doubt, the consequences of the Middle East situation on our balance of payments will give them exactly the relationalisation for their instinctive yearning for more detailed control.

The speeches of the First Secretary in Committee are among my favourite reading. The right hon. Gentleman said: As a result partly of voluntary agreements, but also through the work of the Board, sometimes with the use or possibility with the use of powers, price increases which undoubtedly would otherwise have occurred have been held back …"—[OFFICIAL REPORT, Standing Committee A, 20th June, 1967; c. 47.] I am totally indifferent to whether the argument is about prices or incomes, and I accept that there are serious distinctions from the point of view of the sheer practicabilities involved in enforcing legislation in either direction. On the broad issues of principle, we have a confusion of thought about what is freely accepted and what is freely accepted under duress. The Government choose, as their definition of "freely accepted", free acceptance under the final duress of reference to the Board or reference through legislation consequential on any adverse report of the Board.

This is not freedom for manufacturers to price according to the workings of the economy, or of trade union leaders to seek to determine the price of labour of their members according to the law of supply and demand, the forces to which the Leader of the House apparently referred—

Mr. Speaker

Order. I hesitate to interrupt the hon. Gentleman in his enthusiasm, but he must address his remarks to the Amendment.

9.30 p.m.

Mr. Biffen

—the economic forces, as the Leader of the House called them, because economic forces cannot conceivably be permitted under this legislation.

The Amendment tests the Government. If they believe that it is the rôle of trade unionists to seek to maximise the potential earnings of their members they will accept the Amendment, because they will know, and the First Secretary will be advised by that master of psychology, the Leader of the House, that this will be a gesture that will be widely appreciated below the Gangway, for we know from the representations from below the Gangway we have heard this evening that a method of this sort is required.

I suggest, therefore, that all the evidence points to the one clear conclusion that the First Secretary of State should use this constructive opportunity presented by the Amendment to assert that the Government mean that in a voluntary prices and incomes policy it is the word "voluntary" that can be construed and understood by every ordinary, thinking individual.

Mr. Ian Mikardo (Poplar)

I am now a hard-bitten old Member of this hard-bitten old House and it is not very often that any of its proceedings twang the strings of my emotions, but I must say that a few moments ago I was greatly moved by the account given by the hon. Member for Oswestry (Mr. Biffen) of the way he sat in the Standing Committee on this Bill feeling disappointed, frustrated and unhappy because there he was lacking the company of my hon. Friend the Member for Salford, West (Mr. Orme). That account, Mr. Speaker, of the sufferings of the hon. Gentleman jerked my tear glands and reduced me to an advanced state of lachrimosity.

Mr. Biffen

Does the hon. Gentleman realise that he will quite soon have an opportunity to assuage the pangs of conscience, and redeem the hurt feelings I had from that Standing Committee by joining with me in the same Division Lobby?

Mr. Speaker

Order. We must move now from the tears to the Amendment.

Mr. Mikardo

Yes, Mr. Speaker. May I say to the hon. Member that I am not unacquainted with the opportunities which the procedures of the House provide from time to time to its hon. Members.

I should like now to refer to a point made by the hon. Member, and earlier in an intervention by the hon. Member for Bath (Sir E. Brown). If it is a fact, and it is, that some of my hon. Friends and I are devoting a little more attention to this Report stage than we otherwise would have done, and have, as hon. Members will have observed from the Notice Paper, sought leave to move a number of Amendments, we do so because none of my hon. Friends who feel as I do were selected by the Committee of Selection to serve on the Standing Committee.

You know me well enough, Mr. Speaker, to know that I am the very last Member to imply by so much as a breath any criticism of the Committee of Selection. It would be grossly out of order to do so. It is in so sense criticism of the Committee of Selection, but merely a statement of fact to say that of the three major trends of view existing in this House about the Bill, and all represented on Second Reading—those of the Government and their supporters, who support the Bill, those of hon. and right hon. Members opposite who, for one set of reasons oppose it, and those of some of my hon. Friends and myself who oppose it for a different set of reasons—only two were represented on the Committee.

I repeat that I say this, not by way of criticism but simply as a statement of fact, and it is equally not a criticism of the Committee of Selection but, again, a simple statement of fact, to say that the last time the list of Members added to the Committee on a Bill differed from the lists presented by the Chief Whips on either side was about the same as the last time the Derby was won by a grey, which is a long time ago—

Mr. Speaker

Order. Now that the hon. Gentleman has refrained from criticism, will he come to the Amendment?

Mr. Mikardo

I do not criticise at all, Mr. Speaker. I was merely uttering two statements of absolute incontrovertible fact.

I come to the Amendment. The key thing about it was said by the hon. Member for Oswestry: that the question of whether the Government resist it is a crucial test of good faith. If they mean what they say and what they have said over and over again—that they look upon the prices and incomes legislation, with its statutory and compulsory provisions, as a necessary and temporary evil to be got rid of at the earliest reasonable date—there can be no grounds on which they could resist the Amendment.

The French in their ineffable wisdom have many interesting sayings, one of which is C'est seulement le provisoire qui dure—it is only the provisional which lasts for ever. A story is told in my constituency of a docker who was once taken to task by his parish priest for having lived, as the expression goes, in sin with the same lady for 35 years. He was asked why, if he liked her that much, he did not marry her, and he replied that it was a purely temporary arrangement—"One Thursday afternoon in 1922, between unloading one ship and loading another, I popped in to the lady to have a cup of tea, and I have been there ever since." I have a horrible feeling that that is what is happening and will happen to the prices and incomes legislation. It will go on being temporary for ever. It will always be temporary but it will always be there.

There were warning flags at the head of the mast even before the speech of my right hon. Friend the Leader of the House at the weekend. We had presented to us the other day a Report by the Government Actuary on the Financial Provisions of the National Insurance (No. 2) Bill, 1967. Paragraph 10 of that Report states that on Government instructions, certain assumptions have been made in the calculations. I will not quote the first assumption because, although it is serious, it is not germane to the matter which is before us. The second assumption is that Throughout the period covered by the estimates"— which is three years— earnings are assumed to remain constant at the level expected to apply at the end of October, 1967. If my right hon. Friend says that there is no intention on the part of the Government to carry forward the powers in the Bill beyond August next year, and if he resists the Amendment, as I suspect that he will, on the ground not that it is wrong but that it is not necessary, I ask him to answer the following question.

How is it that the Government can assume constant earnings at the level of those of October, 1967, for a further three years without a continuation of legislative control of wages? If my right hon. Friend can find an answer to that which makes sense to me, he might even, though I doubt the possibility, persuade me to go into the Lobby with him in the Division at the end of the debate. I cannot see how he can.

Mr. McMaster

Has the hon. Member considered the possibility of heavier and heavier unemployment?

Mr. Mikardo

There is an assumption in the Report about unemployment, but I deliberately did not comment on it because I am trying, as always, to keep closely within the rules of order. I am, therefore, keeping purely to the question of earnings, which is what is covered by the Bill. We have a situation in which this temporary legislation will take effect for three years, for two years after it ceases to have effect. I want to know how this miracle will be achieved.

I say with sorrow that if my right hon. Friend resists the Amendment, millions of people will draw their own conclusions from that, and they will be conclusions which he will not find welcome.

Mr. Burden

There is no doubt from the beginning of the suggestion of a Prices and Incomes Bill many hon. Members opposite took very strong exception to the restraint on wages. There is also no doubt that many of them believed that the Government were in good faith determined to bring it to an end at the earliest possible moment and return to a system of voluntary wage restraint. There is also no doubt that, if the Government do not accept the Amendment, it is clearly their intention that the powers of compulsion shall remain. There is also no doubt that the comments of the Leader of the House over the weekend—it is not the first time that comments of the Leader of the House have caused serious embarrassment to the Labour Party, even before it took office—have blown the gaff and caused the Government serious concern.

I am sure that the hon. Member for Salford, West (Mr. Orme) and other hon. Members opposite below the Gangway who are critical of the Government's actions in relation to the Bill would, in common with my right hon. and hon. Friends, very much like to hear the Leader of the House explain exactly what he meant. If the Leader of the House stays away tonight, we can only conclude that, despite all his denials, the report put out by the Press was accurate and that he is deliberately staying away hoping that this exchange with the reporter will preclude him from coming and answering in person tonight.

There is plenty of time. A message could have gone to him by now. If he held for the House the respect which is due to it from a Leader of the House, he would certainly be here before the end of the debate. If he does not appear before the end of the debate, and if the First Secretary does not accept the Amendment, it will be perfectly clear that the Government have kidded the unions regarding the ending of compulsion, that they have kidded the people regarding the ending of compulsion, that they have kidded Parliament as a whole, and, above all, they have kidded the members of their own party who have been critical of the policy from the time the Bill was introduced. No only will it be shown that the Labour Government generally have kidded the people but that, in particular, the Prime Minister when he appeared on television, as referred to by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod), was more culpable than anybody else. But I hope that, before the debate ends, the Leader of the House will come here and in person explain the words which he used over the weekend.

9.45 p.m.

Mr. Heffer

I wish to put several questions to my right hon. Friend. I have been particularly disturbed by the speech made by my right hon. Friend the Leader of the House because, unlike some hon. Members, perhaps, I believed that the Government intended to give up the compulsory powers by August next year. Perhaps I was a little naïve. Perhaps I was a little too trusting. But everyone assured mc, "You chaps have really won the battle. Although this Bill is coming along, it is nothing like what was intended, and we can assure you that, by August next year, all the powers will have gone and we shall then have the beginnings of our voluntary system".

I believed it. Then, this morning, I read the speech of the Leader of the House. There were in it remarks about "another dose of medicine", as though my right hon. Friend was talking to a bunch of school kids who were going to get the medicine whether they wanted it or not.

Mr. Mikardo

And without a spoonful of sugar.

Mr. Heffer

We are, after all, talking to adults, to grown-up trade unionists, to workers who work in the docks, in the mines and on the building sites. We do not need to talk about "medicine". They understand the realities of life very well. They experience the realities of life. They do not need lectures by intellectuals or anybody else—certainly no' by right hon. Members opposite.

We need a clear statement on this matter from the Government. Frankly, I do not understand why the Government cannot accept the Amendment. It was not put down by my hon. Friends and myself, but it is an Amendment which we could easily have put down. As far as I can see, it is a perfectly sensible Amendment, on the basis of the statements which we have been given, that the voluntary system will come into operation from August next year.

My hon. Friend the Member for Poplar (Mr. Mikardo) is right when he says that millions of working people will be closely watching the Government's attitude on this question tonight. Unless they can have a categorical assurance that the powers will cease by August next year, they can be forgiven if they honestly believe that they are being kidded. I warn my right hon. Friends that one can kid people for a little while and get away with it, but, if the working class of this country believe that they are being kidded, particularly by a Government whom they themselves have elected, the results can be disastrous.

I say this in all seriousness and as a real warning to my right hon. Friends. I put this question to them: Did my right hon. Friend's speech which was reported this morning mean what it said, or what it was reported to have said, or are we going to have the end of the compulsory powers by next August? This is the 64,000-dollar question, and we are entitled to an answer. On the basis of that answer, the people of this country, certainly the trade unionists, will decide their future attitude towards the Government, particularly on this question.

Sir E. Brown

This is one of the most vital matters which we fought during Committee, attempting to obtain an answer from the Minister. While the Leader of the House is absent tonight, despite the invitation to come and join in the discussion on this Amendment, in my opinion the culprits are sitting on the Government Front Bench. They are the three Ministers responsible for the attitude taken when we were pressing them during that debate.

The answer which we will get tonight from the right hon. Gentleman is clearly that the Prices and Incomes (No. 2) Act will finish on 11th August, 1968. What the right hon. Gentleman and his friends will not tell us is whether there will be another Bill in its place, either before it, or at the same time as this one ends.

This is the answer which we want from the right hon. Gentleman. Everyone knows that this Bill, when it becomes an Act, will end on 11th August, 1968. The 64,000-dollar question which we know will not be answered is: "Will there be another Prices and Incomes Bill in its place?" If the Minister accepts my right hon. Friend's Amendment, we shall know that the Government are acting in good faith, acting honestly. I doubt whether we shall get an honest answer. We shall be told when this Bill will die, but as to the prospects of a Prices and Incomes (No. 3) Bill, we shall just have to wait until next year.

Mr. Mendelson

It would be much more to the point not to throw about terms like "honesty" and other moral attitudes too much. It would be better to concentrate on the practical importance of the issues before us. The other preliminary point that I would like to make is that I do not complain of the absence of my right hon. Friend the Leader of the House. We have the responsible Minister, the First Secretary of State and Secretary of State for Economic Affairs, who is in charge of the Bill. It is the custom and convention of the House, as the right hon. Gentleman the Member for Enfield, West (Mr. Iain Macleod) will confirm, with his experience of Government office, that there cannot be two Ministers in charge of one Bill, from two different Departments.

Mr. Burden rose—

Mr. Mendelson

I cannot give way. We have serious business to attend to, and this is a serious problem. I do not complain of the absence of my right hon. Friend. It is only natural that the First Secretary should regard it as his duty and responsibility to reply to this debate, and to make all the points which have been raised, on behalf of his Department and the Government.

Nor do I take kindly to the attitude of the right hon. Gentleman the Member for Enfield, West who spoke in such a high moral tone when moving this Amendment. He and other hon. Members opposite seem to give the impression that this Government are the only one who have ever contemplated or are contemplating, some form of legislation that might be regarded by the trade unions as interfering with their traditional rights.

We are meeting today on the Monday following the Saturday when the right hon. Gentleman the Leader of the Opposition, in a major speech at Carshalton, spoke of a far-reaching and serious programme of legal interference with the rights of trade unions. When the party opposite was last in office, it announced on several occasions, through the mouths of various Prime Ministers, that it intended to introduce very severe legislation to curtail the rights of the trade unions.

Mr. Peyton rose—

Mr. Mendelson

I will give way to the hon. Gentleman in a moment. He knows that I always give way to him. It is important to put these facts on record before the moral tone, set for a definite political purpose in this debate by hon. Members opposite, becomes an established and accepted fact.

Mr. Peyton

I do not wish to tempt the hon. Member out of order in discussing the speech of my right hon. Friend the Leader of the Opposition, but will he as least acknowledge that my right hon. Friend could not, under any circumstances, be accused of presenting this as being on a voluntary basis? The core of this evening's controversy lies in whether the Government's policy is genuinely voluntary or is compulsory.

Mr. Mendelson

I need no instruction on either the nature of this legislation, which hon. Members, including myself, have studied for a long time now, or the plain intents of the Leader of the Opposition, because his intentions are a deliberate continuation of what the party opposite has now been saying it wants to do for more than five years—introduce legislation to put the clock back and put the trade unions into a straitjacket. Hon. Members opposite cannot get away with it by putting on a display of high moral indignation in this debate.

As the First Secretary knows—he has always indicated it in all the contributions that he has made to these debates—this is a matter which very much concerns trade unionists, members on his own back benches and the best supporters, and the supporters in general, of Labour and the Labour Movement in the country. This is a Measure of great importance to them. My right hon. Friend has an opportunity tonight to deal with this point in a way that would give reassurance to the trade union movement and the supporters of Labour in the country.

The point is this. It would be understandable that on the technical point about legislation my right hon. Friend could say—he has said it on previous occasions—that there is involved here the effectiveness of an Order beyond a certain date once it had been legally introduced. That is one thing. I would not expect my right hon. Friend when piloting the legislation and replying to a debate on an Amendment suddenly to change course and give an interpretation different from that of the Law Officers of the Government and different from his own intentions. But he will recall that on a previous occasion I put a supplementary question to him on whether he would give the House an assurance that no further legislation of this kind would be introduced, and he said at the time—this is the kernel of the argument that I am putting to him—that ho and the Government would not be reasonably advised to give such an assurance in such categorical terms.

I say in conclusion to my right hon. Friend that there have been various events that have been mentioned and also interpretations and re-interpretations of one kind and another for which he need not be necessarily personally responsible, but this is an important opportunity for him, as the member of the Government concerned with piloting the Bill, to give an assurance on further actions going beyond the effectiveness of particular Orders under the current legislation that he is piloting, and he should not under-estimate the concern that has been created and the great duty that he has to make the position clear when he replies.

Mr. M. Stewart

It will be necessary, I think—I trust that I can do it without

getting out of order—to reply not merely on the particular matter that is involved in this Amendment but on the general question which so many hon. Members have raised. A connection has been drawn—as I shall hope to show, not altogether correctly drawn—between the precise terms of the Amendment and the situation 12 months from now. I trust that I shall be in order in replying—I am sure that it will be the wish of the House—on both these points—the nature of the Amendment itself and the whole question of the relationship of statutory powers to prices and incomes policy. It is rather a large question, but I shall try to do it as briefly as it can be done.

I would start in this way. It is possible to think of having no policy about prices and incomes at all, except what is sometimes called a "free-for-all". That is the proposition that every group of workers, every person or group of persons fixing a price or every landlord and every tenant can fix all these prices and wages solely according to their individual bargaining power and nothing else. As I understand it, most people, with the possible exceptions of the hon. Member for Oswestry (Mr. Biffen) and the right hon. Member for Wolverhampton, South-West (Mr. Powell), reject that free-for-all approach and that rejection has become the more impressive in recent years—

It being Ten o'clock, the debate stood adjourned.

Motion made, and Question put, That the Proceedings on the Prices and Incomes (No. 2) Bill may be entered upon and proceeded with at this day's Sitting at any hour, though opposed.—[Mr. Stewart.]

The House divided: Ayes 200, Noes 138.

Division No. 431.]	AYES	[10.0 p.m.
Abse, Leo	Bray, Dr. Jeremy	Cullen, Mrs. Alice
Alldritt, Walter	Brooks, Edwin	Dalyell, Tam
Armstrong, Ernest	Brown, Hugh D. (G'gow, Provan)	Davidson, Arthur (Accrington)
Ashley, Jack	Brown, Bob (N'c'tle-upon-Tyne, W)	Davies, G. Elfed (Rhondda, E.)
Atkins, Ronald (Preston, N.)	Brown, R. W. (Shoreditch & F'bury)	Davies, Harold (Leek)
Bacon, Rt. Hn. Alice	Buchan, Norman	Davies, Ifor (Gower)
Bagler, Gordon A. T.	Buchanan, Richard (G'gow, Sp'burn)	de Freitas, Rt. Hn. Sir Geoffrey
Barnes, Michael	Butler, Herbert (Hackney, C.)	Delargy, Hugh
Baxter, William	Callaghan, Rt. Hn. James	Dell, Edmund
Bence, Cyril	Carmichael, Neil	Dempsey, James
Benn, Rt. Hn. Anthony Wedgwood	Castle, Rt. Hn. Barbara	Dewar, Donald
Bidwell, Sydney	Coe, Denis	Diamond, Rt. Hn. John
Binns, John	Coleman, Donald	Doig, Peter
Bishop, E. S.	Conlan, Bernard	Dunn, James A.
Blackburn, F.	Crawshaw, Richard	Dunwoody, Mrs. Gwyneth (Exeter)
Boardman, H.	Cronin, John	Dunwoody, Dr. John (F'th & C'b'e)
Bradley, Tom	Crosland, Rt. Hn. Anthony	Eadie, Alex
Edwards, Robert (Bilston)	Jones, T. Alec (Rhondda, West)	Parkyn, Brian (Bedford)
Ellis, John	Judd, Frank	Pavitt, Laurence
English, Michael	Kelley, Richard	Pearson, Arthur (Pontypridd)
Ensor, David	Kerr, Russell (Feltham)	Peart, Rt. Hn. Fred
Evans, Albert (Islington, S.W.)	Lawson, George	Pentland, Norman
Fernyhough, E.	Leadbitter, Ted	Perry, George H. (Nottingham, S.)
Fletcher, Raymond (Ilkeston)	Ledger, Ron	Rankin, John
Fletcher, Ted (Darlington)	Lee, Rt. Hn. Frederick (Newton)	Rees, Merlyn
Foot, Michael (Ebbw Vale)	Lee, John (Reading)	Reynolds, G. W.
Forrester, John	Lewis, Ron (Carlisle)	Roberts, Gwilym (Bedfordshire, S.)
Fowler, Gerry	Lipton, Marcus	Robinson, W. O. J. (Walth'stow, E.)
Fraser, John (Norwood)	Lomas, Kenneth	Roebuck, Roy
Fraser, Rt. Hn. Tom (Hamilton)	Loughlin, Charles	Rose, Paul
Freeson, Reginald	Lyon, Alexander W. (York)	Shaw, Arnold (Ilford, S.)
Ginsburg, David	Lyons, Edward (Bradford, E.)	Shore, Peter (Stepney)
Gordon Walker, Rt. Hn. P. C.	McBride, Neil	Short, Rt. Hn. Edward (N'c'tle-u-Tyne)
Gourlay, Harry	McCann, John	Short, Mrs. Renée (W'hampton, N.E.)
Gray, Dr. Hugh (Yarmouth)	MacColl, James	Silkin, Rt. Hn. John (Deptford)
Gregory, Arnold	MacDermot, Niall	Silverman, Julius (Aston)
Grey, Charles (Durham)	Mackenzie, Gregor (Rutherglen)	Slater, Joseph
Griffiths, David (Rother Valley)	Mackintosh, John P.	Small, William
Hamilton, James (Bothwell)	Maclennan, Robert	Snow, Julian
Hamilton, William (Fife, W.)	McMillan, Tom (Glasgow, C.)	Spriggs, Leslie
Hamling, William	McNamara, J. Kevin	Steele, Thomas (Dunbartonshire, W.)
Hannan, William	MacPherson, Malcolm	Stewart, Rt. Hn. Michael
Harper, Joseph	Mahon, Peter (Preston, S.)	Summerskill, Hn. Dr. Shirley
Harrison, Walter (Wakefield)	Mallalieu, J.P.W. (Huddersfield, E.)	Swingler, Stephen
Hart, Mrs. Judith	Manuel, Archie	Thomas, George (Cardiff, W.)
Haseldine, Norman	Mapp, Charles	Tinn, James
Hattersley, Roy	Marquand, David	Urwin, T. W.
Hazell, Bert	Mason, Roy	Wainwright, Edwin (Dearne Valley)
Heffer, Eric S.	Maxwell, Robert	Walker, Harold (Doncaster)
Henig, Stanley	Mellish, Robert	Watkins, David (Consett)
Herbison, Rt. Hn. Margaret	Mendelson, J. J.	Watkins, Tudor (Brecon & Radnor)
Hooley, Frank	Mikardo, Ian	Wells, William (Walsall, N.)
Houghton, Rt. Hn. Douglas	Millan, Bruce	White, Mrs. Eirene
Howarth, Harry (Wellingborough)	Miller, Dr. M. S.	Whitlock, William
Howarth, Robert (Bolton, E.)	Milne, Edward (Blyth)	Willey, Rt. Hn. Frederick
Howell, Denis (Small Heath)	Morris, Alfred (Wythenshawe)	Williams, Alan (Swansea, W.)
Howie, W.	Morris, John (Aberavon)	Williams, Alan Lee (Hornchurch)
Hoy, James	Murray, Albert	Williams, W. T. (Warrington)
Huckfield, L.	Oakes, Gordon	Willis, George (Edinburgh, E.)
Hughes, Roy (Newport)	Ogden, Eric	Wilson, Rt. Hn. Harold (Huyton)
Hunter, Adam	O'Malley, Brian	Wilson, William (Coventry, S.)
Hynd, John	Orbach, Maurice	Winterbottom, R. E.
Jackson, Colin (B'h'se & Spenb'gh)	Orme, Stanley	Woodburn, Rt. Hn. A.
Jay, Rt. Hn. Douglas	Owen, Dr. David (Plymouth, S'tn)	Woof, Robert
Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)	Owen, Will (Morpeth)
Johnson, James (K'ston-on-Hull, W.)	Page, Derek (King's Lynn)	TELLERS FOR THE AYES:
Jones, Dan (Burnley)	Paget, R. T.	Mr. Alan Fitch and
Jones, Rt. Hn. SirElwyn (W. Ham, S.)	Pannell, Rt. Hn. Charles	Mr. Ioan L. Evans.
NOES
Alison, Michael (Barkston Ash)	Elliott, R.W.(N'c'tle-upon-Tyne, N.)	Iremonger, T. L.
Allason, James (Hemel Hempstead)	Errington, Sir Eric	Irvine, Bryant Godman (Rye)
Astor, John	Eyre, Reginald	Jenkin, Patrick (Woodford)
Baker, W. H. K.	Fisher, Nigel	Jennings, J. C. (Burton)
Biffen, John	Fletcher-Cooke, Charles	Johnson Smith, G. (E. Grinstead)
Boyle, Rt. Hn. Sir Edward	Fortescue, Tim	Jopling, Michael
Braine, Bernard	Fraser, Rt. Hn. Hugh (St'fford & Stone)	Kaberry, Sir Donald
Brewis, John	Galbraith, Hn. T. G.	Kimball, Marcus
Bromley-Davenport, Lt.-Col. Sir Walter	Gilmour, Sir John (Fife, E.)	King, Evelyn (Dorset, S.)
Brown, Sir Edward (Bath)	Glover, Sir Douglas	Kirk, Peter
Bruce-Gardyne, J.	Glyn, Sir Richard	Knight, Mrs. Jill
Bullus, Sir Eric	Gower, Raymond	Lambton, Viscount
Burden, F. A.	Grant-Ferris, R.	Lewis, Kenneth (Rutland)
Campbell, Gordon	Griffiths, Eldon (Bury St. Edmunds)	Lubbock, Eric
Carlisle, Mark	Grimond, Rt. Hn. J.	McAdden, Sir Stephen
Carr, Rt. Hn. Robert	Gurden, Harold	MacArthur, Ian
Chichester-Clark, R.	Harris, Frederic (Croydon, N.W.)	Macleod, Rt. Hn. Iain
Clegg, Walter	Harvie Anderson, Miss	McMaster, Stanley
Cooper-Key, Sir Neill	Hawkins, Paul	Maude, Angus
Corfield, F. V.	Heald, Rt. Hn. Sir Lionel	Mawby, Ray
Costain, A. P.	Heseltine, Michael	Maxwell-Hyslop, R. J.
Craddock, Sir Beresford (Spelthorne)	Higgins, Terence L.	Maydon, Lt.-Cmdr. S. L. C.
Crosthwaite-Eyre, Sir Oliver	Hiley, Joseph	Mills, Peter (Torrington)
Crouch, David	Hirst, Geoffrey	Miscampbell, Norman
Dance, James	Holland, Philip	Mitchell, David (Basingstoke)
Davidson, James (Aberdeenshire, W.)	Hooson, Emlyn	Monro, Hector
Dean, Paul (Somerset, N.)	Hordern, Peter	More, Jasper
Deedes, Rt. Hn. W. F. (Ashford)	Hornby, Richard	Morgan, Geraint (Denbigh)
Dodds-Parker, Douglas	Hunt, John	Morrison, Charles (Devizes)
Eden, Sir John	Hutchison, Michael Clark	Munro-Lucas-Tooth, Sir Hugh

Murton, Oscar	Scott, Nicholas	Walker-Smith, Rt. Hn. Sir Derek
Noble, Rt. Hn. Michael	Sharples, Richard	Walters, Dennis
Onslow, Cranley	Shaw, Michael (Sc'b'gh & Whitby)	Ward, Dame Irene
Page, Graham (Crosby)	Sinclair, Sir George	Weatherill, Bernard
Page, John (Harrow, W.)	Steel, David (Roxburgh)	Webster, David
Pardoe, John	Stoddart-Scott, Col. Sir M. (Ripon)	Wells, John (Maidstone)
Peel, John	Summers, Sir Spencer	Whitelaw, Rt. Hn. William
Percival, Ian	Tapsell, Peter	Wills, Sir Gerald (Bridgwater)
Peyton, John	Taylor, Sir Charles (Eastbourne)	Wilson, Geoffrey (Truro)
Pink, R. Bonner	Taylor, Edward M. (G'gow, Cathcart)	Winstanley, Dr. M. P.
Prior, J. M. L.	Taylor, Frank (Moss Side)	Wolrige-Gordon, Patrick
Pym, Francis	Temple, John M.	Wood, Rt. Hn. Richard
Ramsden, Rt. Hn. James	Thatcher, Mrs. Margaret	Wright, Esmond
Renton, Rt. Hn. Sir David	Tilney, John	Wylie, N. R.
Ridley, Hn. Nicholas	Turton, Rt. Hn. R. H.
Royle, Anthony	van Straubenzee, W. R.	TELLERS FOR THE NOES:
Russell, Sir Ronald	Wainwright, Richard (Colne Valley)	Mr. Anthony Grant and
		Mr. Timothy Kitson.

Question again proposed, That the proposed words be there inserted in the Bill.

Mr. M. Stewart

I was saying that, with a few exceptions, there was a widespread and general rejection in the House and the country of that approach to prices and incomes which is sometimes described as a free-for-all, which would mean that every manufacturer, every supplier, every trade union, every landlord, would use his own bargaining power as seemed most appropriate at the moment, without regard to any wider considerations.

This rejection has gathered strength because of what has been happening in recent years in the trade union movement, the growing realisation that a single trade union acting on the doctrine of a free-for-all would not, except in the very short term, even be serving the best interests of its own members, the general recognition, not only on the trade union side but among management as well, that the pursuit by each particular group of a free-for-all was liable to have such effects on the economy as a whole that all groups would be the losers. That is the philosophy which lies behind the growing rejection of a free-for-all which is now becoming accepted belief.

It was that belief which was behind the statement of intent—that, without any powers of legal compulsion, there should be resolutely accepted and acted upon the concept that prices and incomes should not be left to work themselves out in a free-for-all, but should be a matter of policy to be worked out by common consent, and that, as part of the machinery necessary to that process, there should be a body like the Prices and Incomes Board which would help those involved in reaching judgments as to what claims with regard to prices and incomes were and were not reasonable.

I assert both as my own belief and as the policy of the Government that that is the situation which one wants to create. That was the situation which we hoped to create when the statement of intent was signed. We were overtaken by the balance of payments difficulties and other factors which the House knows, but I repeat that that is what the Government believe to be the right way of handling the problem and that this should be something accepted universally by all groups of workers.

I understand the feelings of my hon. Friend the Member for Liverpool, Walton (Mr. Heffer) about this matter. I ask him to believe that those of us who have taken a rather different view have not done so out of mere expediency and that what I am saying now is out of my deep conviction that we must avoid a free-for-all and if humanly possible avoid it without legal compulsion as something vital to the national welfare and something which ought to be acceptable, particularly to members of our party.

It rather distresses me that he has so usually found it necessary when referring to this matter to add a smear about people who earn their livings by intellectual occupations, because if this rejection of a free-for-all is to mean anything, it surely has to mean the unity of purpose, to use a phrase with which we on this side of the House are familiar, of workers by hand and by brain. We ought to foster the mutual understanding between different kinds of workers with their different backgrounds and the common objective which they all have of avoiding the evils of a free-for-all and gradually getting more and more justice and common sense into the whole question of the distribution of incomes and the distribution of wealth. I believe that I carry many on both sides with me so far.

10.15 p.m.

We come now to the question raised by the Amendment. if our object is the kind which I have just described, and which was set forth in the Statement of Intent, what part, if any, ought statutory powers by the Government to play? I think it will be accepted that there will be such minimum statutory powers as are needed to set up a Prices and Incomes Board and enable it to do its work, but the critical question is: If the degree of self-control exercised on either the prices or the wages side is not big enough voluntarily to prevent the nation from running into grave economic difficulties, ought the Government, even temporarily, to take what are sometimes called long-stop powers, and particularly ought they to take that kind of power if the situation is, as I am sure it was last October, that the great majority of trade unionists are willing to work the thing voluntarily, and do not want to see their voluntary effort frustrated by the actions of a very small minority among them?

That was the situation last October. It was that which caused the trade union movement to accept the idea of activating Part IV of the Prices and Incomes Act, despite the natural concern with which anyone with a trade union or a professional background must look at a statute like Part IV. I would have thought that I would still carry many of the House with me if I said that while a voluntary system—and I hope that I have made it clear what I mean by a voluntary system—is what we want, in times of grave emergency there is a case for the Government having what are called long-stop powers.

Mr. Orme

Will my right hon. Friend explain how a thing can he voluntary if it is surrounded by compulsion?

Mr. Stewart

I think that I can answer my hon. Friend. I said that I distinguished very clearly between a voluntary system, and one in which there was any element of compulsion. I said that I believed that what we want to work for is the voluntary system as I described it. I then said, however, that I thought there were many people who would agree that in times of grave emergency, and if the great majority of trade unionists wanted the thing to be voluntary, but were worried that their voluntary effort would be frustrated by a few, we might temporarily, in an emergency, take a degree of compulsory power.

I accept that the moment we do that we cannot call it a voluntary system in the full sense of the term. I have never disputed that, and I do not do so now, but to describe that situation as if it were one in which the Government, by their own absolute will, imposed compulsion on a whole unwilling mass of trade unionists is a complete misrepresentation of the position, because it would be a physical impossibility for any Government to have even the moderate degree of statutory powers which I have mentioned unless the great majority of the people believed in the working of a prices and incomes policy.

That is why I think it is fair in some circumstances to use the term "fully voluntary" to make it clear that we are describing what I described earlier, namely, the kind of situation set out in the Statement of Intent, where there is no measure of legal compulsion, even long-stop compulsion. It is wrong to represent the imposition of limited emergency powers as an imposition, by the Government's absolute will, of compulsion on a great mass of unwilling people. If anyone thinks that, let him look at the situation as it has developed in the last twelve months. This has not been a voluntary period, but it has been a period in which the great majority of trade unionists have assented to the existence and to the use of the powers. I have never used powers concerning wages without consultation with the T.U.C. It has never objected to any particular use of those powers.

Mr. Biffen

I am grateful to the right hon. Gentleman for the semantic distinction that he has drawn, but may we have a clear understanding that it is now the Government's policy, unequivocally, not to return to the system which he designated as "fully voluntary", but to proceed with the system which he designates as "voluntary"?

Mr. Stewart

The hon. Member is putting into my mouth things that I did not say. I have used the terms "voluntary" and "fully voluntary" in the same sense. I have never disputed the fact that if we have something like Part IV the system is not voluntary. What I have said is that to describe it as an exercise of tyrannical power is a misrepresentation of the facts.

Part IV was an example of the introduction into what had previously been a voluntary system of a degree of compulsory legal powers. Part IV ends in August of this year. The present Bill gives the Government far fewer powers, in time and in circumstances, than did Part IV. That is why I have previously described it as a step towards the voluntary system—a step on the road of return to the voluntary system.

Now we come to the question: what about the period after 12 months from now or, to be exact, in August of next year? As the House, and especially my hon. Friend the Member for Penistone (Mr. Mendelson), will be aware, I have already answered this question. In the Second Reading debate my hon. Friend asked me whether I could give a definite assurance not only that the Bill would run out in 12 months' time—which was net in dispute—but that from that date there would be no legal power whatever.

I replied that I could not give my hon. Friend that assurance; I could tell him that it was the Government's most earnest hope that it would be possible to do that, but I thought that it would be neither wise nor prudent to give that undertaking now. It is possible for any hon. Member, on either side, to say that he does not like that answer. It is not open to any hon. Member to say that he has been deceived by that question. If I tried to give an undertaking which I do not think it would be wise or prudent to give now I may be criticised for deceiving the House. I do not attempt to do that.

I assure the House of one other thing. I have said that it is the Government's most earnest hope that we shall be able to be free of legal powers altogether in August of next year. The charge has been levelled in some speeches that the Government do not really nourish that hope and that, behind my refusal to give the categorical undertaking for which my hon. Friend asks, there lies a deliberate resolve, already established in the Government's mind, to continue the powers after next August. I can only ask the House to accept my firm and absolute assurance that this is not true and that I meant exactly what I said in answer to my hon. Friend. I do not think it right to give him the undertaking now. I can go no further than saying that it is my earnest hope that we shall achieve what we both want in August next year—

Sir E. Brown

Does this mean that we will come to the end on 11th August next year and return to the free-for-all which the right hon. Gentleman says we should not have?

Mr. Stewart

The hon. Gentleman has left out one vital stage in the argument, on which I laid much of the stress. I rejected the free-for-all. I said that I thought that what we all wanted was the ideal enshrined in the Statement of Intent, whereby groups decided deliberately to limit their own action, not because of statutory compulsion but because they believed it just and in the long-term interests of their members as well as anyone else. That is what I want us to return to in August next year and what I thought most of us wanted.

I must ask the House to accept on my behalf and that of the Government my assurance that my answer to my hon. Friend meant exactly what it said. It is suggested that I could give an earnest of that by accepting the Amendment, but its nature stands that argument on its head. If the Government or I had a secret resolve to bring in legislation next August, I could readily accept the Amendment and allow all the anomalies which would follow, knowing that I could tidy it up by legislation next August. It is, on the contrary, because it is my most earnest desire that there shall be no further legislation of this kind next August that I want to see this piece not ending up with what would otherwise be a ragged untidy and unjust arrangement.

It would be unjust because, so far as the powers are to be used at all—I remind the House how few workers have had their pay restricted by Order in the last 12 months how it might work out? A group of workers might try to get a claim clearly in conflict with policy and with a recommendation against it from the Board, so that we felt justified in making an Order. That might happen in November this year and, with the Bill amended as is proposed, their pay could be held back for six months. But a group of workers behaving in exactly the same way in April or May next year would have a limit imposed perhaps for only one or two months. That would not be just or reasonable—

Mr. Mikardo

Would that not be exactly what has happened under the existing legislation—totally different treatment of different groups of workers, some of them held back for two months, some for three or six months and some for longer? Why is my right hon. Friend making a virtue of a consistency which he does not possess?

Mr. Stewart

There have been some differences, but, so far as our present legal powers have allowed, in deciding how long an order should run, we have always considered where the balance of fairness and justice lay. It is true that, under the present legislation, there cannot be as satisfactory and consistent a result as under this legislation. But I see no reason why shortcomings in the existing legislation should be repeated in the Bill.

10.30 p.m.

The whole of the argument which I am advancing would be unnecessary if the Government or I had a secret intent to bring in new legislation of this sort in 12 months' time, because it would be possible in such legislation to pick up any untidy or awkward bits and deal with them then. It is because I trust most earnestly that I shall not be doing that that I ask the House to pass the Bill in a form in which it gives more justice and consistency than one would get from the Amendment.

But what is in issue is not only the merits of the Amendment, but the relationship of this to the whole of prices and incomes policy.

Mr. Higgins

The right hon. Gentleman says that he could introduce legislation next year and pick up all the anomalies. Would not he agree that that is not so? There are specific Clauses in the Bill designed as links and he could not do it next year in a new Bill.

Mr. Stewart

Such is the power of Parliament that in a new Bill one could make whatever arrangements Parliament was prepared to agree to. But we are concerned, not only with the Amendment, but with the whole nature of prices and incomes policy.

In previous Parliaments, when our party was in opposition, I was very much concerned with housing and the operation of the Rent Acts. I saw the Rent Act, 1965, which we introduced when we came to power, as the beginning of the establishment of something like justice in one field of prices. But in that field, for historical reasons, it could and should be done by legislation. What I want to see is the same concept of justice in the distribution of incomes established by the voluntary acceptance by workers and management of the fact that the pursuit of a free-for-all is not only morally wrong, but is not, in the end, except on the shortest view, in the interests of those who pursue it. To get the whole nation to accept that is not easily done.

We have been driven by the pressure of events to try, as I think one of my hon. Friends said on Second Reading, to get short-term as well as long-term results. That it is which has caused some of the differences we have had with the trade union movement and management and between the Government and some of my hon. Friends. I have sought to understand their arguments and tried to share their feelings. They must do the same for the Government. We are taking the course we are taking because we believe that these measures are a necessary step in the very difficult period we are going through. We do not want argument over them to sour or spoil the achievement which I think we all have in mind of a just productivity, prices and incomes policy.

Mr. Peyton

I apologise to the First Secretary and the House for not having been here for the first part of the right hon. Gentleman's speech. I feel that his speech is an important one. I do not charge him with insincerity, because I believe that the sincerity and earnestness of what he said was unchallengeable, but we have grave doubts about how far this policy is practicable and how far the measures he is propounding will endure; how long a time will be necessary before the right hon. Gentleman must take further steps to reinforce measures which none of us find very acceptable.

The First Secretary claimed that it was an accepted belief that free-for-all methods should be rejected. But that rejection does not imply acceptance of impracticable and illusory alternatives. He said his aim was to introduce more and more justice into the distribution of incomes. Considering the events of the past two-and-a-half years, we have no ground to accept that there is a reasonable prospect of even that kind of fairness and justice being secured.

The right hon. Gentleman then talked about the voluntary system, said how it was wanted and urged that in times of grave emergency the Government needed long-stop powers. But for how long will this grape emergency last? We are fearful that so long as the Labour Party lasts, this emergency will endure. And how far from the wicket are these long-stop powers? The hon. Member for Poplar (Mr. Mikardo) asked this question but did not get an answer. It is all very well to employ a loose sporting metaphor of this kind, but the right hon. Gentleman must explain its effect on the lives and affairs of ordinary people.

The First Secretary was asked how something could be voluntary yet surrounded by compulsion, but he did not reply. From the look on his face at the moment he seems in pain. It does not come from listening to me, but because he must be realising the impracticability of his policy. Hon. Gentlemen opposite have a tendency—they have caught it from the Prime Minister—to push out a smokescreen of words which sound fine but which have not been thought out. This smokescreen of phrases does not go to the heart of the problem and, because it is a smokescreen, it is sometimes difficult to disagree with the argument.

The right hon. Gentleman said that it would be a complete misrepresentation to say that the Government had imposed their will on the mass of trade unionists. I wonder how far that is true? Perhaps measures of this kind can be tolerated for a time, but, after the events of the past 12 months, the Government are in grave danger. They have run out of time. They told that great mass of trade unionists that they needed a year. They gave the impression that they would not need to continue to resort to such powers as these. But they have done so, and I believe that in British industry today there is a great impatience, and that when people realise that the Government have not, in fact, moved very substantially from the bad position they took up a year ago there will be a wave of anger.

I do not for one moment say that we on this side have been able completely to produce a solution for the most difficult problem of our time, but if we are true to our beliefs, as we are not always, we must say that we believe that a free market, free competition, a really competitive system backed by a sensible taxation system, is a far more efficient way of producing the fair and just consequences which the right hon. Gentleman has as his objectives than any of these hotchpotch measures which may sound good but which, in the end, will prove to be useless.

I do not want to go on with the semantic argument about what is or what is not voluntary, though the right hon. Gentleman is in difficulty here. It has not been a voluntary period but the great majority of people have assented, apparently, to compulsion, and the First Secretary himself told us that when he said "voluntary" it meant much the same thing as when he said "fully voluntary". His difficulties in expressing his case in words are an indication, and only a very small indication, of the far greater difficulties that underlie the whole problem with which he and the Government have been wholly incapable of grappling in the long term.

He protested that the claim that the Government have exercised tyrannical powers over the trade unions is a misrepresentation, but he went on to claim that this Bill represented a step on the road to the return to a voluntary system. With great respect to the right hon. Gentleman—one does not want to be unkind to him in his present terribly awkward predicament, or to his right hon. Friend, who must find it even more acutely uncomfortable—one must say that it is a very small step. The road on which his predecessor the Foreign Secretary embarked last year was a difficult and dangerous road, and retracing steps along that road will be an even more difficult operation. I wish I could feel that the Government's heart was committed to the task of retracing their steps. I do not believe that it is, nor do I believe such a retracing to be possible for the Government.

The right hon. Gentleman was absolutely fair. I am quite sure that even those of his hon. Friends who do not share his ideas will have accepted that he was not in any way deceiving the House. He went out of his way to say that it would be wrong, that it would be imprudent, to give any assurance that no continuation of legal powers would be necessary in any circumstances. But we are in some difficulty. Over the weekend, we have had a speech, and it is no good denying it, from the Leader of the House, whom we miss here—[HON. MEMBERS: "Where is he?"]—though when he is here he does not always contribute to the harmony as one might expect from the Leader of the House—[Interruption.]

Mr. Speaker

Order. Let us have only one debater at a time.

Mr. Peyton

The hon. Member for Coatbridge and Airdrie (Mr. Dempsey) never loses his charm by the fact that he speaks when sitting down.

Tonight it is necessary to give attention to the fact that the Labour Party thought it necessary to make a statement on the speech made by the Leader of the House. It said, in particular, that Nowhere in the speech did Mr. Crossman either say or imply that the Government is contemplating a return to compulsory wage restraint under any circumstances whatever. Amongst other things, the right hon. Gentleman said this: Now we have Part IV coming off and, if they fail to do it voluntarily, then exactly the same thing will happen again. This is hard, economic fact. It may be hard, economic fact, but it does not exactly tie in with what the right hon. Gentleman has just told the House.

10.45 p.m.

At the end of the report of the speech made by the Leader of the House, we have these words: We have to face the fact that if it happens again and economic forces reassert themselves, the same sort of medicine would have to be given to the people. What intolerable arrogance this is. I do not believe that even the Leader of the House, arrogant as he so often is, would be inclined to use those words to a House of Commons his contempt for which he has never bothered to conceal.

The issues which we are discussing in the Bill are fundamental. They are of great importance to the future of the Government and of the country. One of the charges which I sincerely make against the Government is that faced with really serious issues, they have fumbled and grabbed from the air an ill-thought-out solution which, they hoped, would buy them a year's peace. Now, they face the moment of having to pay the bill and, once again, they are having to put up a facade of words unsatisfactory even to their own supporters, a facade of words, moreover, which threatens to divide and wreck the party opposite and which certainly does nothing to convince us.

Mr. Iain Macleod

To deal first with a point which worried the hon. Member for Poplar (Mr. Mikardo), the last time that a full grey won the Derby was Airborne, in 1946, at 50 to one. The hon. Member will remember it. It was the year he first became a Member of the House.

We have been discussing a matter of great importance. My hon. Friend the Member for Oswestry (Mr. Biffen) and several hon. Members opposite said that the Amendment, perhaps above all others on Report, was a test of the sincerity of the Government. If that be the test, one can only charge that the Government have failed it, although the First Secretary honourably did his best with the case that was made to him.

We have heard a good deal—in my view rightly, because it both worried and angered people—about the speech of the Leader of the House. The hon. Member for Penistone (Mr. Mendelson) said that he made no complaint that his right hon. Friend the Leader of the House was not present. I do complain. The hon. Member for Penistone said that he was content for the First Secretary, who is in charge of the Bill, to answer the debate and deal with these matters. The First Secretary said not a word about it from beginning to end of a rather lengthy reply to the debate.

I have no doubt that the Leader of the House has been told of what has been said. I have no doubt that the Whips, with their usual efficiency, have discharged that task. The Leader of the House has heard the request that he should come, and he has ignored it. That is a disgraceful way to treat the House of Commons. It is not a question of who is in charge of the Bill. Of course, the First Secretary is in charge of it, but what was said by the Leader of the House undermines the whole basis of the Bill.

If the First Secretary, whose embarrassment at that appalling speech by the Leader of the House I can understand, wishes to shuffle it over in silence, at least he should see that the Leader of the House was present to explain what he said. The truth of the matter is that tin speech of the Leader of the House was a hectoring, arrogant and bombastic speech and no explanation of it is credible if one studies closely, as I have done, the shorthand account of it. I cannot believe that when the Leader of the House spoke of medicine being given—I ask the House to note the arrogance of the phrase "being given"—to the people he meant unemployment. Of course he did not. He meant Part IV and what goes with it, or a new version of Part II when the time comes.

The hon. Member for Liverpool, Wilton (Mr. Heffer) said that he for one believed the Government when they said that they were moving towards a voluntary system or, perhaps, towards in the end a version of what is called a free-for-all with a longstop, whatever it may be. The hon. Gentleman believed it and he believed the Government. I can understand, therefore, that it is even worse for him than it is for us, because we never believed it. We expected and we prophesied the double cross that we have seen particularly appropriately in the speech that the Leader of the House made a day or two ago. All these statements are, at the very best, devious and, at the worse, a good deal less attractive than that.

I want to make it absolutely clear—I did so in my first speech, but I spell it out now—that I accept absolutely the First Secretary's good faith. I think I would be joined in that by every one of my right hon. and hon. Friends. But I must say frankly that we do not extend that same belief to the Prime Minister, nor to the Leader of the House. A few moments ago the First Secretary said that these powers of Part IV were, I think his words were, not tyrannical. When the Prime Minister wished to play up the effectiveness of Part IV—he was in Washington, not in the House—this is what he said: We have taken steps which have not been taken by any other democratic government in the world. We are taking steps with regard to prices and wages which no other Government, even in wartime, has taken. That is what the Prime Minister said when he wanted to sell the effectiveness of Part IV in Washington. It is no good using soft, dove-like words here. It was the hawk speaking in Washington. It is not possible to believe a Government whose spokesmen say such utterly different things.

The First Secretary very fairly said that he could not give a guarantee for next year. He will understand that it is precisely this that makes us so suspicious.

The Government's spokesman in another place, the Parliamentary Secretary to the Minister of Public Building and Works, Lord Winterbottom, in the debate on the incomes policy in another place last week, said this: Whether or not by 1968 we shall have a further Prices and Incomes Bill is in the lap of the gods."—[OFFICIAL REPORT, House of Lords, 5th July, 1967; Vol. 284, c. 172.] I have no doubt that that is the position. I have no doubt that the First Secretary has not made up his mind. He tells us that he has not. The words which Lord Winterbottom used—I will not weary the House by reading on—show that he is at least more than dubious as to whether we shall be able to move away from compulsory legislation, but I accept the First Secretary's good faith. Indeed, I have never doubted it; and no words of mine have impugned it. However, I do impugn what the Prime Minister said in Washington and the reality in this country of Part IV. I attack the Prime Minister for saying what he said on B.B.C. television in "24 Hours", which I quoted in my opening remarks, as contrasted with the reality of the Bill.

Above all, we attack the Leader of the House for his speech last weekend, both

for what he said and for his cowardice in not coming to explain it to the House of Commons.

Sir D. Glover rose—

Mr. William Whitlock (Lord Commissioner of the Treasury) rose in his place and claimed to move, That the Question be now put.

Question put, That the Question be now put:—

The House divided: Ayes 189. Noes 129.

Division No. 432.]	AYES	[10.54 p.m.
Abse, Leo	Fraser, Rt. Hn. Tom (Hamilton)	McMillan, Tom (Glasgow, C.)
Alldritt, Walter	Freeson, Reginald	McNamara, J. Kevin
Armstrong, Ernest	Gardner, Tony	MacPherson, Malcolm
Ashley, Jack	Gordon Walker, Rt. Hn. P. C.	Mahon, Peter (Preston, S.)
Atkins, Ronald (Preston, N.)	Gourlay, Harry	Mallalieu, J.P.W. (Huddersfield, E.)
Atkinson, Norman (Tottenham)	Gray, Dr. Hugh (Yarmouth)	Manuel, Archie
Bacon, Rt. Hn. Alice	Gregory, Arnold	Mapp, Charles
Bagier, Gordon A. T.	Grey, Charles (Durham)	Marquand, David
Barnes, Michael	Griffiths, Will (Exchange)	Mason, Roy
Baxter, William	Hamilton, James (Bothwell)	Maxwell, Robert
Bence, Cyril	Hannan, William	Mellish, Robert
Benn, Rt. Hn. Anthony Wedgwood	Harper, Joseph	Mendelson, J. J.
Bidwell, Sydney	Harrison, Walter (Wakefield)	Mikardo, Ian
Binns, John	Hart, Mrs. Judith	Millan, Bruce
Bishop, E. S.	Haseldine, Norman	Milne, Edward (Blyth)
Blackburn, F.	Hattersley, Roy	Morris, Charles R. (Openshaw)
Bradley, Tom	Hazell, Bert	Morris, John (Aberavon)
Bray, Dr. Jeremy	Heffer, Eric S.	Murray, Albert
Brooks, Edwin	Henig, Stanley	Newens, Stan
Brown, Rt. Hn, George (Belper)	Herbison, Rt. Hn. Margaret	Oakes, Gordon
Brown, Hugh D. (G'gow, Provan)	Hooley, Frank	Ogden, Eric
Brown, Bob (N'c'tle-upon-Tyne, W)	Houghton, Rt. Hn. Douglas	O'Malley, Brian
Brown, R. W. (Shoreditch & F'bury)	Howarth, Robert (Bolton, E.)	Orbach, Maurice
Buchan, Norman	Howell, Denis (Small Heath)	Orme, Stanley
Buchanan, Richard (G'gow, Sp'burn)	Howie, W.	Owen, Dr. David (Plymouth, S'tn)
Callaghan, Rt. Hn. James	Hoy, James	Page, Derek (King's Lynn)
Carmichael, Neil	Huckfield, L.	Paget, R. T.
Coe, Denis	Hughes, Roy (Newport)	Parkyn, Brian (Bedford)
Coleman, Donald	Hunter, Adam	Pavitt, Laurence
Conlan, Bernard	Jackson, Colin (B'h'se & Spenb'gh)	Pearson, Arthur (Pontypridd)
Crawshaw, Richard	Jay, Rt. Hn. Douglas	Pentland, Norman
Crosland, Rt. Hn. Anthony	Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)	Perry, George H. (Nottingham, S.)
Cullen, Mrs. Alice	Jenkins, Hugh (Putney)	Rees, Merlyn
Dalyell, Tam	Johnson, James (K'ston-on-Hull, W.)	Reynolds, G. W.
Davidson, Arthur (Accrington)	Jones, Dan (Burnley)	Roberts, Albert (Normanton)
Davies, Harold (Leek)	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Roberts, Gwilym (Bedfordshire, S.)
Davies, Ifor (Gower)	Jones, T. Alec (Rhondda, West)	Robinson, W. O. J. (Walth'stow, E.)
de Freitas, Rt. Hn. Sir Geoffrey	Judd, Frank	Roebuck, Roy
Dell, Edmund	Kerr, Russell (Feltham)	Rose, Paul
Dempsey, James	Lawson, George	Shaw, Arnold (Ilford, S.)
Dewar, Donald	Leadbitter, Ted	Shore, Peter (Stepney)
Diamond, Rt. Hn. John	Ledger, Ron	Short, Rt. Hn. Edward (N'c'tle-u-Tyne)
Doig, Peter
	Lee, Rt. Hn. Frederick (Newton)	Short, Mrs. Renée (W'hampton, N. E.)
Dunn, James A.	Lee, John (Reading)	Silkin, Rt. Hn. John (Deptford)
Dunwoody, Mrs. Gwyneth (Exeter)
Dunwoody, Dr. John (F'th & C'b'e)	Lewis, Ron (Carlisle)	Silverman, Julius (Aston)
Eadie, Alex	Lipton, Marcus	Slater, Joseph
Ellis, John	Lomas, Kenneth	Small, William
English, Michael	Loughlin, Charles	Spriggs, Leslie
Ennals, David	Lyon, Alexander W. (York)	Stewart, Rt. Hn. Michael
Ensor, David	Lyons, Edward (Bradford, E.)	Summerskill, Hn. Dr. Shirley
Evans, Albert (Islington, S.W.)	McBride, Neil	Swingler, Stephen
Evans, Ioan L. (Birm'h'm, Yardley)	McCann, John	Thomas, George (Cardiff, W.)
Fernyhough, E.	MacColl, James	Tinn, James
Fletcher, Raymond (Ilkeston)	MacDermot, Niall	Urwin, T. W.
Fletcher, Ted (Darlington)	McGuire, Michael	Wainwright, Edwin (Dearne Valley)
Foot, Michael (Ebbw Vale)	Mackenzie, Gregor (Rutherglen)	Watkins, David (Consett)
Forrester, John	Mackie, John	Watkins, Tudor (Brecon & Radnor)
Fowler, Gerry	Mackintosh, John P.	Wells, William (Walsall, N.)
Fraser, John (Norwood)	Maclennan, Robert	White, Mrs. Eirene
Whitlock, William	Williams, W. T. (Warrington)	Woof, Robert
Willey, Rt. Hn. Frederick	Willis, George (Edinburgh, E.)
Williams, Alan (Swansea, W.)	Wilson, Rt. Hn. Harold (Huyton)	TELLERS FOR THE AYES:
Williams, Alan Lee (Hornchurch)	Wilson, William (Coventry, S.)	Mr. Alan Fitch and
Williams, Mrs. Shirley (Hitchin)	Woodburn, Rt. Hn. A.	Mr. Harold Walker.
NOES
Alison, Michael (Barkston Ash)	Hawkins, Paul	Peel, John
Allason, James (Hemel Hempstead)	Heald, Rt. Hn. Sir Lionel	Percival, Ian
Astor, John	Heseltine, Michael	Peyton, John
Atkins, Humphrey (M't'n & M'd'n)	Higgins, Terence L.	Pink, R. Bonner
Baker, W. H. K.	Hiley, Joseph	Price, David (Eastleigh)
Biffen, John	Hill, J. E. B.	Prior, J. M. L.
Boyle, Rt. Hn. Sir Edward	Hirst, Geoffrey	Pym, Francis
Braine, Bernard	Holland, Philip	Ramsden, Rt. Hn. James
Brewis, John	Hooson, Emlyn	Renton, Rt. Hn. Sir David
Bromley-Davenport, Lt.-Col. Sir Walter	Hordern, Peter	Ridley, Hn. Nicholas
Brown, Sir Edward (Bath)	Hornby, Richard	Royle, Anthony
Bruce-Gardyne, J.	Howell, David (Guildford)	Russell, Sir Ronald
Carlisle, Mark	Hunt, John	Scott, Nicholas
Carr, Rt. Hn. Robert	Hutchison, Michael Clark	Sharples, Richard
Chichester-Clark, R.	Iremonger, T. L.	Shaw, Michael (Sc'b'gh & Whitby)
Clegg, Walter	Jenkin, Patrick (Woodford)	Sinclair, Sir George
Cooper-Key, Sir Neill	Johnson Smith, G. (E. Grinstead)	Smith, John
Corfield, F. V.	Jopling, Michael	Steel, David (Roxburgh)
Dance, James	Kaberry, Sir Donald	Stoddart-Scott, Col. Sir M. (Ripon)
Davidson, James (Aberdeenshire, W.)	Kimball, Marcus	Summers, Sir Spencer
Dean, Paul (Somerset, N.)	King, Evelyn (Dorset, S.)	Tapsell, Peter
Deedes, Rt. Hn. W. F. (Ashford)	Kirk, Peter	Taylor, Sir Charles (Eastbourne)
Dodds-Parker, Douglas	Kitson, Timothy	Taylor, Edward M. (G'gow, Cathcart)
Eden, Sir John	Knight, Mrs. Jill	Taylor, Frank (Moss Side)
Elliott, R.W. (N'c'tle-upon-Tyne, N.)	Lambton, Viscount	Thatcher, Mrs. Margaret
Emery, Peter	Lewis, Kenneth (Rutland)	Tilney, John
Errington, Sir Eric	Lubbock, Eric	Turton, Rt. Hn. R. H.
Fisher, Nigel	MacArthur, Ian	van Straubenzee, W. R.
Fletcher-Cooke, Charles	Macleod, Rt. Hn. Iain	Wainwright, Richard (Colne Valley)
Fortescue, Tim	Maude, Angus	Walker, Peter (Worcester)
Fraser, Rt. Hn. Hugh (St'fford & Stone)	Maxwell-Hyslop, R. J.	Ward, Dame Irene
Gilmour, Sir John (Fife, E.)	Maydon, Lt.-Cmdr. S. L. C.	Weatherill, Bernard
Glover, Sir Douglas	Mills, Peter (Torrington)	Webster, David
Glyn, Sir Richard	Miscampbell, Norman	Wells, John (Maidstone)
Goodhew, Victor	Mitchell, David (Basingstoke)	Whitelaw, Rt. Hn. William
Gower, Raymond	Monro, Hector	Wills, Sir Gerald (Bridgwater)
Grant, Anthony	Morrison, Charles (Devizes)	Wilson, Geoffrey (Truro)
Grant-Ferris, R.	Munro-Lucas-Tooth, Sir Hugh	Winstanley, Dr. M. P.
Griffiths, Eldon (Bury St. Edmunds)	Murton, Oscar	Wolrige-Gordon, Patrick
Grimond, Rt. Hn. J.	Noble, Rt. Hn. Michael	Wylie, N. R.
Gurden, Harold	Onslow, Cranley	Younger, Hn. George
Harris, Frederic (Croydon, N.W.)	Page, Graham (Crosby)	TELLERS FOR THE NOES:
Harris, Reader (Heston)	Page, John (Harrow, W.)	Mr. Jasper More
Harvie Anderson, Miss	Pardoe, John	and Mr. Reginald Eyre.

Question put accordingly, That the proposed words be there inserted in the Bill:—

The House divided: Ayes 129, Noes 174.

Division No. 433.]	AYES	[11.4 p.m.
Alison, Michael (Barkston Ash)	Dodds-Parker, Douglas	Hawkins, Paul
Allason, James (Hemel Hempstead)	Eden, Sir John	Heald, Rt. Hn. Sir Lionel
Astor, John	Emery, Peter	Heseltine, Michael
Atkins, Humphrey (M't'n & M'd'n)	Errington, Sir Eric	Higgins, Terence L.
Baker, W. H. K.	Eyre, Reginald	Hiley, Joseph
Biffen, John	Fisher, Nigel	Hill, J. E. B.
Boyle, Rt. Hn. Sir Edward	Fletcher-Cooke, Charles	Hirst, Geoffrey
Braine, Bernard	Fortescue, Tim	Holland, Philip
Brewis, John	Fraser, Rt. Hn. Hugh (St'fford & Stone)	Hooson, Emlyn
Bromley-Davenport, Lt.-Col. Sir Walter	Gilmour, Sir John (Fife, E.)	Hordern, Peter
Brown, Sir Edward (Bath)	Glover, Sir Douglas	Hornby, Richard
Bruce-Gardyne, J.	Glyn, Sir Richard	Howell, David (Guildford)
Carlisle, Mark	Goodhew, Victor	Hunt, John
Carr, Rt. Hn. Robert	Cower, Raymond	Hutchison, Michael Clark
Chichester-Clark, R.	Grant, Anthony	Iremonger, T. L.
Clegg, Walter	Grant-Ferris, R.	Jenkin, Patrick (Woodford)
Cooper-Key, Sir Neill	Griffiths, Eldon (Bury St. Edmunds)	Johnson Smith, G. (E. Grinstead)
Corfield, F. V.	Grimond, Rt. Hn. J.	Jopling, Michael
Dance, James	Gurden, Harold	Kaberry, Sir Donald
Davidson, James (Aberdeenshire, W.)	Harris, Frederic (Croydon, N.W.)	Kimball, Marcus
Dean, Paul (Somerset, N.)	Harris, Reader (Heston)	King, Evelyn (Dorset, S.)
Deedes, Rt. Hn. W. F. (Ashford)	Harvie Anderson, Miss	Kirk, Peter
Kitson, Timothy	Peel, John	Taylor, Edward M. (G'gow, Cathcart)
Knight, Mrs. Jill	Percival, Ian	Taylor, Frank (Moss Side)
Lambton, Viscount	Peyton, John	Thatcher, Mrs. Margaret
Lewis, Kenneth (Rutland)	Pink, R. Bonner	Tilney, John
Lubbock, Eric	Price, David (Eastleigh)	Turton, Rt. Hn. R. H.
MacArthur, Ian	Prior, J. M. L.	van Straubenzee, W. R.
Macleod, Rt. Hit. Iain	Pym, Francis	Wainwright, Richard (Colne Valley)
Maude, Angus	Ramsden, Rt. Hn. James	Walker, Peter (Worcester)
Maxwell-Hyslop, R. J.	Renton, Rt. Hn. Sir David	Ward, Dame Irene
Maydon, Lt.-Cmdr. S. L. C.	Ridley, Hn. Nicholas	Weatherill, Bernard
Mills, Peter (Torrington)	Royle, Anthony	Webster, David
Miscampbell, Norman	Russell, Sir Ronald	Wells, John (Maidstone)
Mitchell, David (Basingstoke)	Scott, Nicholas	Whitelaw, Rt. Hn. William
Monro, Hector	Sharples, Richard	Wills, Sir Gerald (Bridgwater)
Morrison, Charles (Devizes)	Shaw, Michael (Sc'b'gh & Whitby)	Wilson, Geoffrey (Truro)
Munro-Lucas-Tooth, Sir Hugh	Sinclair, Sir George	Winstanley, Dr. M. P.
Murton, Oscar	Smith, John	Wolrige-Gordon, Patrick
Noble, Rt. Hn. Michael	Steel, David (Roxburgh)	Wylie, N. R.
Onslow, Cranley	Stoddart-Scott, Col. Sir M. (Ripon)	Younger, Hn. George
Page, Graham (Crosby)	Summers, Sir Spencer	TELLERS FOR THE AYES:
Page, John (Harrow, W.)	Tapsell, Peter	Mr. R. W. Elliott and
Pardoe, John	Taylor, Sir Charles (Eastbourne)	Mr. Jasper More.
NOES
Abse, Leo	Gordon Walker, Rt. Hn. P. C.	Maxwell, Robert
Alldritt, Walter	Gourlay, Harry	Mellish, Robert
Armstrong, Ernest	Gray, Dr. Hugh (Yarmouth)	Millan, Bruce
Ashley, Jack	Gregory, Arnold	Milne, Edward (Blyth)
Atkins, Ronald (Preston, N.)	Grey, Charles (Durham)	Morris, Charles R. (Openshaw)
Bacon, Rt. Hn. Alice	Hamilton, James (Bothwell)	Morris, John (Aberavon)
Bagier, Gordon A. T.	Hannan, William	Murray, Albert
Barnes, Michael	Harper, Joseph	Noel-Baker, Rt. Hn. Philip (Derby, s.)
Baxter, William	Harrison, Walter (Wakefield)	Oakes, Gordon
Bence, Cyril	Hart, Mrs. Judith	Ogden, Eric
Benn, Rt. Hn. Anthony Wedgwood	Haseldine, Norman	O'Malley, Brian
Binns, John	Hattersley, Roy	Orbach, Maurice
Bishop, E. S.	Hazell, Bert	Owen, Dr. David (Plymouth, S'tn)
Blackburn, F.	Henig, Stanley	Page, Derek (King's Lynn)
Bradley, Tom	Herbison, Rt. Hn. Margaret	Parkyn, Brian (Bedford)
Bray, Dr. Jeremy	Hooley, Frank	Pavitt, Laurence
Brooks, Edwin	Houghton, Rt. Hn. Douglas	Pearson, Arthur (Pontypridd)
Brown, Rt. Hn. George (Belper)	Howarth, Robert (Bolton, E.)	Pentland, Norman
Brown, Hugh D. (G'gow, Provan)	Howell, Denis (Small Heath)	Rees, Merlyn
Brown, R. W. (Shoreditch & F'bury)	Howie, W.	Reynolds, G. W.
Buchan, Norman	Hoy, James	Roberts, Albert (Normanton)
Buchanan, Richard (G'gow, Sp'burn)	Huckfield, L.	Roberts, Gwilym (Bedfordshire, S.)
Callaghan, Rt. Hn. James	Hunter, Adam	Robinson, W. O. J. (Walth'stow, E.)
Carmichael, Neil	Hynd, John	Roebuck, Roy
Coe, Denis	Jackson, Colin (B'h'se & Spenb'gh)	Rose, Paul
Coleman, Donald	Jackson, Peter M. (High Peak)	Shaw, Arnold (Ilford, S.)
Conlan, Bernard	Jenkins, Hugh (Putney)	Shore, Peter (Stepney)
Crawshaw, Richard	Johnson, James (K'ston-on-Hull, W.)	Short, Rt. Hn. Edward (N'c'tle-u-Tyne)
Crosland, Rt. Hn. Anthony	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Short, Mrs. Renée (W'hampton, N.E.)
Cullen, Mrs. Alice	Jones, T. Alec (Rhondda, West)	Silkin, Rt. Hn. John (Deptford)
Dalyell, Tam	Judd, Frank	Slater, Joseph
Davidson, Arthur (Accrington)	Lawson, George	Small, William
Davies, Harold (Leek)	Leadbitter, Ted	Spriggs, Leslie
Davies, Ifor (Gower)	Ledger, Ron	Stewart, Rt. Hn. Michael
de Freitas, Rt. Hn. Sir Geoffrey	Lee, Rt. Hn. Frederick (Newton)	Summerskill, Hn. Dr. Shirley
Dell, Edmund	Lewis, Ron (Carlisle)	Swingler, Stephen
Dempsey, James	Lipton, Marcus	Thomas, George (Cardiff, W.)
Dewar, Donald	Lomas, Kenneth	Tinn, James
Diamond, Rt. Hn. John	Loughlin, Charles	Urwin, T. W.
Doig, Peter	Lyon, Alexander W. (York)	Wainwright, Edwin (Dearne Valley)
Dunn, James A.	Lyons, Edward (Bradford, E.)	Watkins, David (Consett)
Dunwoody, Mrs. Gwyneth (Exeter)	McBride, Neil	Watkins, Tudor (Brecon & Radnor)
Dunwoody, Dr. John (F'th & C'b'e)	McCann, John	Wells, William (Walsall, N.)
Eadie, Alex	Maccoll, James	White, Mrs. Eirene
Edwards, Robert (Bilston)	MacDermot, Niall	Whitlock, William
Ellis, John	McGuire, Michael	Willey, Rt. Hn. Frederick
English, Michael	Mackenzie, Gregor (Rutherglen)	Williams, Alan (Swansea, W.)
Ennals, David	Mackie, John	Williams, Alan Lee (Hornchurch)
Ensor, David	Mackintosh, John P.	Williams, Mrs. Shirley (Hitchin)
Evans, Albert (Islington, S.W.)	Maclennan, Robert	Williams, W. T. (Warrington)
Evans, Ioan L. (Birm'h'm, Yardley)	McMillan, Tom (Glasgow, C.)	Willis, George (Edinburgh, E.)
Fernyhough, E.	McNamara, J. Kevin	Wilson, Rt. Hn. Harold (Huyton)
Fletcher, Raymond (Ilkeston)	MacPherson, Malcolm	Wilson, William (Coventry, S.)
Forrester, John	Mahon, Peter (Preston, S.)	Winter bottom, R. E.
Fowler, Gerry	Malialieu, J.P.W. (Huddersfieid, E.)	Woodburn, Rt. Hn. A.
Fraser, John (Norwood)	Manuel, Archie	Woof, Robert
Fraser, Rt. Hn. Tom (Hamilton)	Mapp, Charles	TELLERS FOR THE NOES:
Freeson, Reginald	Marquand, David	Mr. Alan Fitch and
Gardner, Tony	Mason, Roy	Mr. Harold Walker.

Mr. Atkinson

I beg to move Amendment No. 12, in page 2, line 9, at the end to insert: (3) Subsections (1) and (2) of this section shall not apply to any award or settlement which increases the wages or salary of any person or persons by an amount equivalent to an increase in the National Insurance contribution payable by that person or those persons. The benches opposite may be a little premature, depending on some of the things we may have to say. All of us have learnt a great deal about the Opposition in these debates. We are now seeing some true colours. If insincerity can be charged against anyone it can certainly be charged against those hon. Members opposite who have taken part in these debates.

Lieut.-Colonel Sir Walter Bromley-Davenport (Knutsford)

Oh, get on with it.

Mr. Atkinson

If the hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) carries on like that, I am sure that he will be in serious trouble before long.

This is an extremely important Amendment, because it concerns a section of the community which has suffered possibly more than any other as a result of the incomes policy—the lower income workers, who have, noticeably, not had any increase of any substantial amount during the last three or four years. We move the Amendment to try to help solve some of the difficulties from which those people suffer and to direct the attention of the Government to the plight of these people. This is a very difficult Amendment to move, because I do not want to stray beyond the guide lines laid down by both yourself, Mr. Deputy Speaker, and Mr. Speaker himself.

11.15 p.m.

Mr. Webster

On a point of order. The hon. Gentleman is not audible in this part of the Chamber. We cannot hear hint at all.

Sir W. Bromley-Davenport

He is not worth hearing, anyway.

Mr. Deputy Speaker

I hope that the House will enable the hon. Member for Tottenham (Mr. Atkinson) to be heard.

Mr. Atkinson

I am surprised about that sort of complaint. I should have thought that I was one of those—perhaps in a minority in the House—that even the cloth ears of those opposite could hear what I have to say.

I was speaking about a section of the community which gathers no sympathy from those opposite. Therefore, many of the things which have been said—[HON. MEMBERS: "Why?"] I can tell hon. Members why. We have to listen in the debate to a lack of sincerity in talking about the lower income groups and about some of the provisions of the Bill. Therefore, I want to distinguish myself from the comments made opposite. I hope to prove that the cheers which we had earlier from the Opposition are unjust. In doing so I am referring to the Government's decision to impose yet a further burden on many people in the form of an increase in their National Insurance contributions. This amounts to about 2s., which, on an average wage of about £10 a week, is a 1 per cent. decrease in their earnings. I suggest that this is a formidable amount when the costs of living are increasing in the way that they are.

This 2s. has taken on the form of compulsory savings. Many of us have had a great deal to say about the idea of a poll tax, but this 2s. looks very much like that. I want to avoid going into the whole detail of the insurance charges. I recognise that it is not for us in this debate to repeat any of the argument that was used last Friday or since the announcement was made. Our purpose is to recognise that the 2s. is to be charged from October next. None the less, it is a very serious imposition on many of our lower income people.

I make one reference to the 2s. itself. The statement by the Minister of Pensions, in referring to the tables which have been published, indicated that that 2s. will over-subscribe the amount required to meet the increasing benefits. Therefore, we could argue that we are accumulating an amount of money for some time in the future. Over the next three years, according to the tables published, we will be in the black, as it were, and accumulating a large sum of money, but the Government are adamant in their decision to make this extra 2s. payable from October. The position is that many of our lower income people, who are suffering the imposition of a rigid incomes policy, have yet again to face up to this additional burden.

We move the Amendment in the hope that the Government will look again at some method of excluding workers below a certain income from direct payment of this 2s. We suggest that any wage award that is made in any negotiations should be excluded if it relates to the 2s. additional burden imposed by the changes in National Insurance.

We also make this argument because most people who are dependent on bonus earnings, or who can derive some benefit from piece work earnings, or those many sections of the community which are able to gain some kind of expense account, are able to augment their incomes in many ways which are not directly applicable to the prices and incomes policy and can escape, because they can adjust their incomes to take account of this further imposition. But there are large sections of the community, those to whom we often refer as the under-privileged, the deprived sections, the lower income groups, particularly those with large families, who pay no taxation but who rather receive allowances and so on, who have yet again to face a further reduction in their living standards.

Our idea in moving the Amendment is to draw the attention of the Government to the needs of these people, those who cannot offset this additional cost from any other source, but who are dependent on Government action to be able to negotiate with their employers an increase equivalent to the increased National Insurance contribution.

That is basically the case which we want to make and I have made it in a very few minutes, because on this side of the House we are conscious of the time involved in our further Amendments and perhaps by the brevity of our speeches on our first Amendment we can set the tone of the debate.

Mr. Biffen

The cheers which were accorded to the hon. Member for Tottenham (Mr. Atkinson) and, surprisingly, to myself merely reflect the generosity and good nature of the House at this early stage of this evening's proceedings. Although the hon. Member for Tottenham truly said that he had dealt with the subject briefly, he would be the first to concede that the brevity was not in any way related to the significance of the Amendment, because it is an important Amendment which exercised those of us who had the privilege of serving on the Standing Committee, which the hon. Member did not have, despite his memorable contribution on Second Reading.

Fairly early in our proceedings on the Standing Committee we taxed the First Secretary with all the implications, which would flow from an increase in the employee's National Insurance contribution, for the Government's prices and incomes policy, and the fact that no satisfactory answer was given on that occasion fully justifies this Amendment.

It is useful for the House to reflect upon the process of income determination of wage negotiation. Of course it is perfectly true that very rarely, if ever, will a claim be made solely to recoup for the employee the amount by which his tax—which is what the National Insurance contribution is—is increased. The First Secretary's view was: What should be the response to a wage increase demand solely to match the increased contribution? Then, the First Secretary, to engage the Committee, put to use his wide-ranging knowledge when he continued: I do not believe that situation will ever occur. When wage demands are made, many other criteria come in as well. That is perfectly true. If I may be allowed some self-publicity, there was some point in my sub-argument, subsequently addressed to the First Secretary. I said that all people concerned, whether as employers or employees, with wage increases, and I quote: … in the course of negotiations should know whether they should disregard any element which arises from the National Insurance increase cost to be borne by the employee. I continued for a short while and my hon. Friend the Member for Worthing (Mr. Higgins) said: We really must have an answer on this"—[OFFICIAL REPORT. Standing Committee A, 22nd June, 1967; c. 94–8.] But the First Secretary had the answer. He rose in his place and claimed to move, "That the Question be now put."

Mr. Russell Kerr (Feltham)

About due!

Mr. Biffen

The hon. Member for Feltham said, I think, "About due". I hope he will not be quite so easily put off by that kind of treatment, should it be preferred by the Treasury Bench on the Amendment which he has signed, because a number of principles arise from the Amendment.

We know that, in many cases, one part of the claim filed on behalf of employees will be the increase in the cost of living on account of National Insurance contributions. When employers respond to this claim in what the First Secretary is pleased to call a voluntary policy, presumably they will want guide lines on this specific issue: should they disregard that element of the claim which arises from the increase in the employee's National Insurance contribution? The First Secretary, in Standing Committee, did not deal with that point. If he is not prepared to reveal this to the House, does he reveal it to the employers? If so, this House should be jealous of its traditions and rights.

As the hon. Member for Tottenham said, a National Insurance employee's contribution is a poll tax. To pretend that the National Insurance Fund is funded in any conventional sense is part of the fiction of the National Insurance system, but it would be out of order to discuss that on this Amendment. This contribution bears significantly much more heavily on the lower-paid worker. We are told it is the objective and determination of the Government in putting through this legislation that the lower-paid worker shall have his position improved relative to his fellow employees, and presumably to the self-emloyed. Therefore, it is a test of whether the Government stand by their declaration as to how they will respond to the Amendment proposed from below the Gangway opposite. It cannot be dismissed as an unnecessary Amendment, one creating technical difficulties. It challenges the Government in the precise area in which they have sought to be judged, the assumption that this policy can narrow differentials, and relatively improve the status of the lower paid.

11.30 p.m.

The third point of principle is that the Amendment raises the whole problem not merely of Government expenditure which proceeds from the National Insurance Fund, but the whole range of Government expenditure. There are many increases in taxation which inevitably bear much more heavily upon the employed sections of the community, and one is entitled to direct this question specifically to the Government, because the call is for generalised restraint, restraint for everyone, apparently, except the Government. The one characteristic which is quite clear is that public expenditure has not been restrained to any noticeable degree over the last 12 months, or is likely to be over the next 12 months. From this will inevitably flow increasing rates of taxation, which must have a very real bearing on the whole question of the determination of wages, and the extent to which employers are expected by the Government to disregard wage claims which proceed from the argument that taxation has increased, and the cost of living has gone up as a consequence.

I am not here arguing—because I wish to try to keep myself to the terms of order—about whether this is, or is not, a desirable thing, but one thing which is quite certain is that the House should be told what the Government expect should be the reaction of employers.

Mr. Mendelson

I think that the hon. Gentleman is wise not to say too much about the latter point two days after the Leader of the Opposition has announced that he intends to shift the burden of taxation from those who can carry it very well, to the shoulders of those who cannot carry it at all.

Mr. Biffen

The night is young, and I am invited to broaden the debate.

Mr. Deputy Speaker (Sir Eric Fletcher)

The hon. Member must resist that temptation.

Mr. Biffen

With great reluctance, but of course I accept your Ruling. Nevertheless, the point will not be lost. I hope that the debate will be continued not only in this Chamber, but in the country. We are determined that it will be. I am sure that a large number of trade unionists are hoping that when the debate is continued outside the Chamber there will be rather more virility attached to the actions of the opponents of the Government's prices and incomes policy than the rather passive attitude which has been deployed so far.

I am speaking early in the evening, and this is the first Amendment which has come from the benches opposite below the Gangway. In some senses this is going to be their first occasion this evening to show exactly with what force and determination—I do not use the word "sincerity", because I do not for one minute doubt the sincerity of hon. Gentlemen opposite—they intend to pursue this Amendment.

I have been sidetracked. I was dealing with the principle which arises from the generalised attitude towards restraint on public expenditure, and how this was clearly linked with the Amendment.

There is one final point that I make on this. I believe this to be a matter of real significance, and it certainly should be for hon. Gentlemen opposite. In this Amendment we are discussing the employee's National Insurance contribution. It is extraordinary that throughout all these debates on prices and incomes policy there proceeds the assumption that it is the rôle of the Government to determine and allocate employee incomes. There is never a word about incomes arising from self-employment, and yet this is bound to be a very real factor in the total level of income within this country. For touching on this point the hon. Member for Tottenham must be congratulated.

Of course, the Government have no means of identifying any movement of price or of fee which will recoup the self-employed person on the same scale as they will through the normal, conventional collective machinery for wage negotiation which may seek to recoup the income for the employee. There is by virtue of sheer administrative necessity a double standard of judgment, and hon. Members opposite know this to be true. They know perfectly well that the machinery which is being put before the House in this legislation can operate effectively only where those who are participating in price or wage determination are visible and organised. Visibility is the crime.

The Amendment demonstrates the concern which the hon. Member for Tottenham and his hon. Friends have for the lower-paid employees, but in so doing it raises all these other issues and, indeed, almost every Amendment to this legislation is a trip-wire which sets up wider considerations of immense ramifications.

The fact is that the Government have not really thought this out at all. This is what gives such a sinister significance to the speech of the Leader of the House. I am not going back over all that again, but I feel that I have some very strong claim to comment on it. After all, it was made in the County of Shropshire and it was made to some of my constituents; also I fought the Leader of the House in the 1959 election, albeit unsuccessfully. Having got those "commercials" out of the way, I say that the speech of the Leader of the House is bound to be the recurring theme throughout the Amendments that we are discussing this evening.

Mr. Deputy Speaker

No, we really cannot go back and have a Second Reading debate on every Amendment. We have finished with that now.

Mr. Biffen

I fully agree, Mr. Deputy Speaker. These raise perhaps wider points which I can more adequately ventilate on Third Reading.

I have no wish to detract from the force of the argument of the hon. Member for Tottenham when I say that this matter was considered and debated in Standing Committee, and I hope that I have demonstrated from the references that I have made to the debates in Standing Committee what cavalier treatment we were given.

The person who should be answering this debate is the person who moved "That the Question be now put," namely, the First Secretary of State. He sent the Joint Parliamentary Secretary to the Ministry of Labour to do the dirty work for him. I am second to none in my membership of the fan club of the Joint Parliamentary Secretary, but he ought not to be at the Dispatch Box answering this Amendment. This is the first Amendment to come from below the Gangway on the benches opposite, and the First Secretary of State is the person suitable to answer it.

Mr. Mikardo

For the hon. Member for Oswestry (Mr. Biffen), the Amendment is a challenge to the Government and the chance to launch a generalised attack on almost everything they ever say and do, and he gave some advice to the Government on who should reply to the debate. For me, it is none of these things, but a serious attempt to help some people who are badly off and for whom the continuing increases in their contribution to the weekly stamp represents, because they are low-paid, an almost intolerable burden.

One of the Government's strongest arguments for their policy is that it is designed precisely to advantage these people against the interests of what it is now fashionable to call the "selfish minority". The picture painted by the First Secretary and some of his colleagues is of a helpless mass of low-paid workers being done down by a handful of selfish workers who are well off, not because they live by not working, as do the best-off people, but because they are paid more for their work. It is said that the Government are providing a "long-stop" on their behalf, but what they call a long-stop is more like a little boy under the sightscreen on the wrong side of the boundary rails.

Are they really protecting these workers? If so, they should think about the insurance contribution, which bears heavily on them. It is a pity that we cannot illustrate our speeches with a blackboard, as what I am saying could he better put that way. If one drew a curve on which the vertical axis was the percentage of income taken in taxation, and the horizontal axis was income, the curve would start at just under 30 per cent., would drop steadily as income increased to little more than half that, and would then rise steadily to the highest point of earned income, back to the original 30 per cent.

Thus, taking all forms of taxation, direct and indirect, the people who pay the highest percentage of income in taxation are the lowest-paid and the highest-paid workers, and a wide range of people in between pay a lower percentage, sometimes not much more than half as much. This is simply because of the stamp. In all other forms of taxation it Js roughly progressive. The poorest worker pays no Income Tax, and he drinks and smokes less than others because he cannot afford more. In almost all those forms of tax based on consumption he pays less than the man who earns 50 to 200 per cent. more. Yet he still pays a higher percentage of his income in tax because the regressive effects of the poll tax are sufficient to over-set the progressive effect of all other forms of taxation.

11.45 p.m.

This is seldom understood except by people who have the opportunity to see how the families of the lower-paid workers work out their weekly budgets and what it means to them in practice. Whereas the £1,000-a-year man or £1,500-a-year man can take on the chin without great difficulty the periodic increases in the employees' contribution to the stamp, the man at the lowest end of the earning scale can pay them only by doing without something else. There is no fat from which it can come. There are no luxuries in such a household, and a necessity must go to the wall.

Therefore, nothing is a greater inspirer of wage claims at that level than an increase in the poll tax. The hon. Gentleman was right to say that nearly always a wage claim is inspired by an amalgam of three things. But I do not know a single one which induces it more than such an increase, when the wife says to her husband at the end of the week, "Bill, you must get a bit more money from somewhere because you have taken this out of my housekeeping and I just cannot manage."

I hope that the Government will not tell us that all the apparatus which they are now putting at their disposal, this great engine which they have fashioned for their control, will be put to work where small marginal wage claims are most directly inspired among the lowest-paid workers in this way. The Amendment relates to all workers, but if the Government wanted to change that we should be happy. We do not have the resources of Government Departments or even of the research department of the Conservative Central Office at our disposal. We must do our own homework. Some of us are not very good at it, but we do our best. If my right hon. Friends wanted to suggest a better form of words which would confine the benefit to the sort of people of whom I am speaking, we should be very happy to accept it. It it of these people that we are thinking, and it is for their benefit that we have put down the Amendment.

If it is resisted, I shall never again attach the least credence or weight to any of my right hon. Friends who talk about the Bill being designed to help the lowest-paid workers. That argument would simply not hang together. For that reason, I very much hope that whatever happens to other Amendments, this one will commend itself to the Government and be accepted by them.

Mr. Pardoe

I should like to take up a point made by the hon. Member for Tottenham (Mr. Atkinson) in moving the Amendment, which I support. He accused hon. Members on this side of the House of insincerity. He must take that back in connection with the Liberal Bench, because it was from here that most of the cheers came when he rose to make his speech.

Sir W. Bromley-Davenport

Where are they?

Mr. Pardoe

I doubt very much whether the mathematics of the hon. and gallant Member are so bad that he can find much more than one-twelfth of his party behind him.

We have been advocating the abolition of this poll tax certainly since I left the Labour Party and joined the Liberal Party—and that is at least seven years.

Mr. Webster

In view of the hon. Gentleman's great knowledge of the subject, why was not one Member of the Liberal Party on the Committee which dealt with the Bill concerning graduated pensions in 1958–59?

Mr. Pardoe

I suspect that it was for the usual reason. Unless we twist the arms of the Government Whips, as we did in the recent selection of the Sub-Committee on oil pollution of the beaches, we do not usually get Members of our party on committees of any sort. We occasionally exercise blackmail and are successful.

I wonder why the proposers of the Amendment did not take the opportunity of opposing this tax when we had a three-hour debate last week when it was imposed? I do not remember seeing any of the proposers of the Amendment here on Friday to discuss the matter. Many of us were here to oppose the Government then.

Like the hon. Member for Poplar (Mr. Mikardo), I do not have the advantages of the Civil Service or the Conservative Central Office Research Department behind me, and it is probably because of that that I represent the only party which has an effective substitute for this tax. There was plenty of opportunity to oppose this tax last week. There have been 21 years in which to oppose it since the Labour Party came to power. There have been two major increases in contribution since, and on each occasion they have hit the lowest-paid workers hardest. It would have been very much better to have opposed the tax, which we are told is a poll tax, as it is, rather than try to make up for the hard effects of the tax by tabling this Amendment.

Mr. Orme

The hon. Gentleman is missing the point of the Amendment. We are not attacking the tax system or any increases; that would not be in order. What we are saying is that any increases, for whatever reason, must be excluded from the prices and incomes policy and must not be taken into account when wage demands are made.

Mr. Pardoe

But both the hon. Gentleman's hon. Friends have made great play with the fact that this is a poll tax. It was precisely that point that I was taking up. As I say, it would have been better if they had attacked the tax when it was imposed rather than by tabling this Amendment.

It is not lack of concern that I hold against the Labour Party. I know that its members know that there is real poverty and that lower-paid workers will suffer very much from the tax. What I oppose them on is the fact that they know that the effects of an increase in a tax of this sort will be severe and that the Government will not accept their proposal. This increase will have a very real effect on the families of lower-paid workers. In the last week or so we have had a survey of the circumstances of families which highlighted what many of us already knew about the circumstances of poorer families.

From where is the 2s. 0d. coming? It may be only 1 per cent. of the income of a family living on £10 a week, but when it has to come out of one tin or other on the kitchen mantelpiece, and when it is a matter of its coming out of the expenditure on the one meal a week with which the family has meat, it is a very real imposition. It is too easy to say, as the Government say, "Anybody can afford 2s. a week". But at these levels of income and expenditure, a tax of an extra 2s. a week, for families which budget in sixpences and pennies, is a real burden.

This increase will hit certain areas of the country more than others. In my constituency in Cornwall many people earn low incomes. For many of them the payment of an extra 2s. a week will be a burden. Yet, like many hon. Gentlemen opposite, I had believed that the incomes policy was designed to help the lower-paid workers. I recall the speeches made during the last General Election campaign, and at that time I had considerable sympathy for a policy which would help those families which find it difficult to manage. There has been no evidence that the Labour Party's policy will aid the lower-paid workers and it is now proven that the Govern-m Nit do not care a fig for these workers.

Mr. Michael Foot (Ebbw Vale)

My hon. Friend the Member for Poplar (Mr. Mikardo) put the principal argument for the Amendment plainly and there is no need for me to delay the House or repeat that case. However, there are additional arguments which should persuade the Government to adopt the Amendment or a comparable method of dealing with the problem.

In seeking to pursue their incomes policy this year, the Government are making a mistake very much like the one they made last year. Over and above the intrinsic weaknesses in the policies introduced in July of last year, the Chancellor of the Exchequer had taken steps which made it impossible for the incomes policy to proceed. In his Budget last year, the Chancellor introduced S.E.T., and as it was to come into operation that autumn, it was bound to increase prices. That made it impossible for the Government to win overwhelming backing for their incomes policy at that time.

In the same way, on this occasion, what the Government have done—may be for perfectly reputable reasons in another sphere—is to say that National Insurance contributions are to be increased to pay for increased old age pensions, which means this Measure being maintained in circumstances when the Government are taking action to weaken the incomes position and to make the pressure against the incomes policy all the greater. This being so, I trust that the Government will try to see if they can go some way to accepting the Amendment.

There is another argument—a wider, political one—which is strictly related to the Amendment. I am sure that all my hon. Friends want to see a proper incomes policy introduced. Indeed, we believe that such a policy is essential to Socialism. However, we believe that a proper incomes policy cannot be inserted by itself into an economy in which the Government are refusing to take a series of other measures which are required to secure a fairer distribution of incomes. It is because the Government have held back many of the measures for the fairer distribution of income to which they are committed that they make it all the more difficult for them to win allegiance for their incomes policy.

12 m.

This applies directly to the question of insurance contributions. It has been the policy of the Labour Party for many years that we are not content with the poll tax system. There is hardly one member of the party who has not denounced the poll tax principle of the insurance scheme over the past five or six years. For longer than even the hon. Member for Cornwall, North (Mr. Pardoe) can recall, in his political infancy, many of us were denouncing it. I remember that Aneurin Bevan denounced the principle of the poll tax years ago. It has become part of the accepted philosophy of the Labour Party that we are opposed to the insurance contribution on the flat-rate poll tax basis.

Therefore, over the years, the Labour Party has also devised and presented to the public a series of proposals for overcoming this difficulty. We were committed, and are committed, to abolishing the whole of the graduated pension swindle introduced by hon. Members opposite, and substituting an entirely new system of our own. A great deal of work has been done by the Labour Party, both by those in Transport House and those who devised the general policy statements that have been presented to the party.

Those statements were incorporated in the official policies of the party, and were presented to the electorate both in 1964 and 1966. Elaborations of the policy were presented in 1966: there was to be an income guarantee; an alteration of the whole system of the poll tax; a complete overhaul of the pensions scheme, and an entirely new system was to be introduced as one of the reforming measures to which the Government were committed. No one on this side of the House can dispute that.

All those measures have been held up, and all of them are intimately concerned with an incomes policy. Part of the incomes policy to which the Labour Party was committed at the last election was the pensions plan. That pensions plan is not in operation, and we do not even know when it will come into operation. I do not know of the experience of some of my hon. Friends, but I get asked at political meetings up and down the country by workers who are engaged in active employment no more frequent question than when the pledge about the graduated pensions scheme is to be brought into operation.

I have heard my right hon. Friend the Minister of Social Security say that she wishes to proceed with it. I am sure that she does, and that the Government do, but it has been held up because of the general financial stringency in which the Government say the country is placed. But if that is the case, if an essential part of our incomes policy of trying to share more fairly the wealth of the country is held up because of the economic situation, the Government cannot claim that they are carrying out the full incomes policy.

They should be making provisions to safeguard the position in the meantime, if they are not able to bring into operation the principles of the fair pensions policy to which they are pledged—and the Government are as much committed as we are to the proposition that the present pensions schemes are unfair and that the poll tax is unfair. They are committed to a graduated system of payments instead of the poll tax system, but say they have not the money to introduce that scheme yet—

Mr. Pardoe

But does not the hon. Member agree that the part of the proposals that would do away with the poll tax would not necessarily increase the burden on the economy at all, that therefore it could well be brought in, and the Government argument has no force at all?

Mr. Foot

I understand that the Government's claim is—and there is some force in it—that they wish to introduce a radical overhaul of the whole pensions scheme and, undoubtedly, if it were carried through on a proper basis, that would cost the Exchequer more. I do not want to see a half-baked or a quarter-baked scheme introduced instead. Undoubtedly, it was believed by most of those who voted for the Labour Party at the last election that we should have proceeded much sooner with that essential part of sharing the wealth of the nation fairly: that is, a complete overhaul of the pension scheme. That is held up and we do not know when it will come into operation.

In the meantime, the Government say that they are going ahead with a certain part of their incomes policy. It is largely because of this, because of the context in which the Government try to operate their incomes policy—because they have not changed the general climate in the country—that they get such poor allegiance to their policy.

My right hon. Friend the First Secretary talked earlier about the idea of an incomes policy being sound. I do not know whether he was referring to the attacks made upon it by some of my hon. Friends. It is not our attacks which cause sour feelings about the incomes policy. One of the perils of the Government's policy is that they have associated an incomes policy with ferocious deflation, with their whole economic policy of stringency and the deliberate creation of unemployment.

The Government have associated an incomes policy with those policies and with an abandonment of the immediate or early commitment for a radical overhaul of our pension scheme. Because they have done this, they have made an incomes policy look entirely as a policy of restriction, of stopping wage increases. People who jumped to that conclusion have jumped to the right conclusion. The Government have not even taken measures to try to impose a proper wage policy on Surtax payers, who still get the £80 million a year in relief that they were given by the right hon. and learned Member for Wirral (Mr. Selwyn Lloyd) when he was Chancellor of the Exchequer.

Mr. Deputy Speaker

Order. The hon. Member is getting a long way from the Amendment.

Mr. Foot

If I have gone a long way, I must come a long way back. I assure you, Mr. Deputy Speaker, that I considered the argument relevant, because the Government have not taken measures for using the Budget to alter the sharing of the nation's wealth. Unless they accept the Amendment, they are not taking special precautions to ensure that those with the lowest incomes will be able to recompense themselves by wage increases for the heavy increases in insurance contributions which are being imposed.

I hope, therefore, that the Government will be prepared to consider our Amendments. I hope that in this debate they have not set out with the idea of suggesting that they must resist all my hon. Friends' Amendments. I hope that each of them will be considered on merit. If the Government made a number of concessions to some of my hon. Friends who propose the Amendments, if they would make a start by accepting this Amendment, they could start to get a different attitude to their incomes policy in the country.

Let the Government realise that we represent far bigger numbers outside the House of Commons. They know very well that they will have the greatest difficulty in getting support for their policy at the Trades Union Congress and the Labour Party Conference. If they wish to show that they understand the strength of feeling outside the House of Commons in the Labour and trade union movements, their best course would be, if not to accept the precise wording of the Amendment, to show that they are willing to consider it and produce an Amendment which safeguards the essen- tial principle which my hon. Friends have put forward.

Mr. Paul Hawkins (Norfolk, South-West)

I support the Amendment, and in doing so I hope that the hon. Member for Tottenham (Mr. Atkinson), who moved it, will take back what I can only consider as a nasty smear on hon. Members on this side of the House. We represent, just as hon. Members opposite do, lower-paid workers in many industries who, I certainly agree, have an extremely thin time. The Amendment would make a gesture at least in trying to alleviate those who are at the lower end of the income group.

In my area a large number of agricultural and ancillary workers earn £5 a week less than the average wage of all manual workers. To earn their wage they must work five hours a week longer. There is no more hard-working or underpaid band of men than agricultural workers. I know these workers. I know the conditions in which they live. Many of them have fairly large families. They have to budget down to the last penny to make ends meet.

I believe that the Government's prices and incomes policy has not helped lower-paid workers to even begin to catch up those who earn a little more than them. I support the Amendment from my personal knowledge of many families who live in a wage level which we do not want to see. These people work very hard. The Amendment would go some way towards alleviating their position. I hope that, if a satisfactory answer is not given, the Amendment will be pressed to a Division.

Mr. Webster

I share the views of my hon. Friend the Member for Norfolk, South-West (Mr. Hawkins) about the remarks of the hon. Member for Tottenham (Mr. Atkinson) which, as usual, were moderate except about his political opponents. I wish the hon. Gentleman would not always impute that anybody who speaks on such an Amendment does so with a lack of sincerity. That was his imputation. It has not been withdrawn. I regret that the hon. Gentleman has on two occasions in my hearing during this fairly long Report stage imputed dishonourable motives. I impute none to him.

Mr. Atkinson

My invitation to hon. Members opposite, if they feel so keenly about this, is that they should denounce their behaviour during 13 years of Tory Government. If hon. Members opposite —I exclude Liberals—were to say, "We recognise that for 13 years the Tory Government were wrong in what they did", I would accept their sincerity.

Mr. Webster

I agree with the hon. Gentleman about excluding the Liberals. I had the privilege to serve as a P.P.S. at the Ministry of Pensions and National Insurance during a period in which the National Insurance pension increased by 20 per cent. more than the cost of living. That is not an achievement which is to be seen at present. I therefore hope that the hon. Gentleman will not make such imputations. During my first weeks in the House, when the National Insurance Bill was being debated in 1959, Labour Members resisted the graduated contribution proposals root and branch. Those innovations by the Tory Government have given great benefit, albeit they were only a start. On our return to office we shall do more to increase the opportunity of people who earn a little more to set aside more of their earnings towards their retirement. This refers to the increase in contributions which is payable in total.

I accept the point that the hon. Gentleman the Member for Tottenham makes on the subject of family poverty. It is real and very desperate, and I very much hope that I will not make political points on this subject. It exists and everyone deplores it. It is one of the greatest problems in what is often seen to be an affluent society. The affluence is on the surface; the poverty is miserably submerged. This is something which can be done to assist.

12.15 a.m.

In last week's Ministry of Social Security report it was suggested, in The Times, that there were about 1 million children in families below subsistence level. I am thinking particularly of the children. About half a million of them were in 160,000 families which were thought to be enduring the greatest hardship. They were the children of fathers who were in full-time employment, or who were out of work and prevented by the wage stop from receiving full allowances. In these cases allowances are kept to what the father would have been earning if he had been at work.

There is great validity in what the hon. Gentleman has said, and I hope that if he does not get a satisfactory answer from the Minister he will press the Amendment. It is deplorable that there is no one here from the Minister of Social Security to give the view of the Department, when the Minister has, for years in opposition and Government, trumpeted up and down the country, talking about the grinding meanness of Tory policy.

Mr. Pardoe

I should like to draw the hon. Member's attention to the fact that not only is no one here tonight from the Ministry of Social Security, but that the Minister without Portfolio, who is responsible for all these changes in the overall system, did not come here on Friday, when we discussed this matter.

Mr. Webster

I listened with very great interest to the speech by the Chairman of the Parliamentary Labour Party, the right hon. Member for Sowerby (Mr. Houghton). It was the best speech that I have heard from that side of the House. There is a tussle entering pensions, when the Government are spreading the benefits too thinly over the whole rather than giving to those in greatest need.

The hon. Member for Tottenham and the hon. Member for Poplar (Mr. Mikardo) came nearer to my hon. Friends than ever on the subject of a means test, and I hope that this indicates a change of thinking among hon. Members opposite. It is wrong to deprive those who are in the greatest need, particularly children. They will be made miserable and may, I do not say this in a pejorative sense, become stunted citizens. Hon. Members opposite know in their heart of hearts that this is wrong.

Another thing that I have noticed is that during this debate hardly anyone has mentioned the contributory principle. If we had debated this subject 10 years ago everyone would have stuck to this principle. I am one of those who is sufficiently old-fashioned to think that we should stick to this principle, and who thinks that people should have the feeling that their pension is theirs, as of right. They may not contribute more than 30 per cent. of it. We appreciate that, but they have contributed a great deal more through their taxes, as well as through their insurance contributions as employees.

I should not like to see the day come w hen the contributory principle is dispensed with altogether, and it is strange that we should do something to erode it in these particular cases.

Mr. Fletcher-Cooke

This debate is very simple and within a narrow compass. Unlike all the other provisions of the Bill, which are immensely complicated, this one is simple and easy to understand. It is whether not only lower-paid workers but all workers should be able to save themselves from having their standard of living positively arid directly depressed to the degree of 2s. a week by asking—not necessarily getting but asking—for wages in compensation for that depression.

That is something which I think every hon. Member can understand and, I should have thought, would have accepted; that they would be entitled to ask, and if their employer is so minded, entitled to get it. But no.

The hon. Member for Poplar (Mr. Mikardo) said that if this Amendment was resisted he would never attach any credence to talk from the Government about their care for lower-paid workers. I have news for him. It will be resisted because it was resisted in Committee. My hon. Friend the Member for Oswestry (Mr. Biffen) was not, I think, absolutely correct when he said we did not get an answer to this question in Committee. After a great deal of needling, after a great deal of pressure conducted, I may say, exclusively by hon. Members on this side of the House and with not a word from any of the hon. Members on the other side, the First Secretary—after the evasive sentence in col. 94 quoted by my hon. Friend—said this: What should be the response to a wage increase demand solely to match the increased contribution? do not believe that situation will ever occur. He does not believe that any worker in the country will ask his boss for another 2s to make up for the increased contribution he has to pay. That is what the Firs: Secretary said, but of course everybody will. He then went on eventually to say this: If we were asked if it"— that is the ability to comply with this request for an extra two bob to make up for the increased contribution where in accordance with the criteria to pay an increase simply and solely to match the increased contribution, the answer would be 'No'"— so that from that moment the credence of the hon. Member for Poplar has to disappear. The answer has been given as "No" and the First Secretary goes on as anybody who has read the criteria would be aware, but, in any case, the situation would not arise."—[OFFICIAL REPORT, Standing Committee A, 22nd June, 1967; c. 94.] That, I think, was the most astonishing ivory tower statement I have heard. Of course it will arise in cases where workers seek compensation for this increased contribution. In many more cases it will be one of the ingredients put forward to justify wage increases which will have to be isolated and dismissed by anybody who is considering granting it on pain or fear of being reported to Mr. Aubrey Jones.

The hon. Member for Poplar and his friends may be sure of this—it is not in accordance with the law of the Medes and Persians, and that is the criteria; the criteria do not admit of this, and when there is conflict between the criteria and the needs of the lower-paid workers the criteria will win.

As I said, this is a simple matter but a very important one. There are eight names to this Amendment and I am sure many more sympathisers with it among hon. Members opposite. It is the first time, as far as I know, that the conflict has become sharp and direct between what they believe and what their party orders say, and we look forward with great interest—and so does the country —to see which will prevail.

Mr. Hattersley

I begin by endorsing the words of my hon. Friend the Member for Poplar (Mr. Mikardo) when he said that this is a serious Amendment. It is indeed, and it is so treated by the Government.

I want also to comment on the words of my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot), who said that he hoped that the Government had not set out with the idea of resisting the Amendments tabled by some of his and my hon. Friends. I give a categorical assurance that that has certainly not been the case. I think that my hon. Friend supposes that there are two alternatives, one being that the Government look at these Amendments with a jaundiced eye and decide to resist them and the other that the Government look at them objectively and decide to accept them. I think that on reflection he will agree that there is at least one further alternative, and it may be that that third alternative is one that the Government have to choose this evening.

Before I come to the Government's actual choice, I want to make the further concession that essentially this debate is about the lowest-paid workers. I understand very well that technically the Amendment would make it possible for wage and salary increases to be paid to all financial sections of society to meet the increases in the National Insurance contributions, but I know very well that the intention of my hon. Friends in tabling the Amendment was to safeguard the interests of the lowest-paid workers. Therefore, I make no attempts to score points or make debating points about the inappropriateness of tabling Amendments which would offer the extension of the concession to many other categories.

Nor do I make a point about the entirely artificial nature of the situation which such Amendments pose. I am sure that it is artificial to assume that a wage increase would be totally related to an increase in National Insurance contributions and artificial to assume that if a wage increase was not totally so related the element in it related to such increase could be identified. But I can say that all those things are unimportant in terms of my speech on the Amendment. The Amendment is about the lowest-paid workers, and it is to them that I want to come.

But before I do that I must talk for a moment about the general financing of National Insurance and the general economic exercise—

Mr. Deputy Speaker

The hon. Gentleman cannot do that on the Amendment. It does not arise on the Amendment.

Mr. Hattersley

I understand your point very well, Mr. Deputy Speaker. My mistake was to say that I must spend a moment on the general concept of the financing of National Insurance.

I should have said that I turn first to the theory outlined in the admirable speech, in many ways, of the hon. Member for Weston-super-Mare (Mr. Webster), who told us to consider for a moment the concept of a pensions scheme which was related to its contributions and said how very much he regretted that the idea that contributions and payments would be related to each other was sometimes in over-sophisticated quarters these days regarded as fiction. He urged us to remember that the investment, as it was to him, in the form of a National Insurance contribution was in terms of a benefit eventually received and that the immediate investment was intended to provoke an eventual receipt.

If this is the intention of the National Insurance contribution, clearly the Government cannot support an Amendment which says that this direct, if not actuarily funded, contribution towards an eventual pension should be made not out of the real incomes of the man who eventually receives the pension but out of a paper wage increase, that that increase in contributions should be financed out of inflation—because that is what it amounts to if the Amendment is accepted and is understood in the terms of National Insurance finance as outlined by the hon. Member for Weston-super-Mare.

Not least of the reasons why the Government could not accept a situation in which National Insurance contributions are financed out of a wage inflation is that a society and an economy which run their affairs in that way are the sort of society and economy which find is difficult to organise the sort of social security scheme that was expected by my hon. Friend the Member for Ebbw Vale and was rightly described by him as a sort of scheme at which we should be aiming.

12.30 a.m.

Another alternative theory, put forward by my hon. Friend the Member for Tottenham (Mr. Atkinson) and the hon. Member for Oswestry (Mr. Biffen), is that the increase in contributions is in no way directly related to the eventual benefit of the recipient but is really a glorified form of taxation, a poll tax, something related not to their eventual receipts but to the receipts of other people receiving Natiónal Insurance payments this year rather than in 40 years' time.

I hope again that my hon. Friend and the other supporters of the Amendment will understand that, if the National Insurance contribution were intended as a taxation measure which compensated for additional purchasing power poured into the economy in the form of increased old age pensions, clearly it would be economically disastrous if that compensatory taxation were simply accounted for by wage inflation.

Again, the sort of society which allows for that sort of taxation increase or contribution increase to be compensated for simply by wage inflation is the sort of society which cannot afford the right sort of social security benefits in the first place.

These are the two economic justifications which the Government must put forward for saying that they cannot accept the Amendment. But, having given those justifications, I repeat that I understand the problems which beset the lowest-paid workers. I do not minimise the problems of the lowest-paid workers if an extra I per cent. of their income goes into contributions. I understand that the extra 2s. or 1s. 9d. is considered as a tax. It is a regressive tax, taking no account of family commitments or income levels. Therefore, I accept the many criticisms of this fiat rate in terms of the lowest-paid workers.

But this does not seem to me to be a justification for accepting the Amendment as it stands. What it does mean is a total justification for ensuring that the lowest-paid workers receive special concessions and special concern in the general prices and incomes policy. What we should be saying is not that to the 2 million lowest-paid workers who have received wage increases during the period of severe restraint an extra 2s. might well be an additional burden they would find hard to bear. We should remember that it is because they are the lowest-paid workers and because additional burdens are difficult for them to bear that the general concessions to them have been made.

Because they have special problems—meeting small family items, making ends meet, balancing the family budget—the lowest-paid workers have been largely exempted from the period of severe restraint. Our attitude towards them should not be to exempt them from special charges but to ensure that their general income level increases despite the incomes policy and according to the criteria, which means that such special attitudes are not extended to those not regarded as being among the lowest paid.

I therefore ask my hon. Friends to resist the Amendment in the knowledge that the Government are aware of and sensitive to the problems of the lowest-paid workers and that the record shows that the Government have always allowed a pay increase to go ahead when the lowest-paid workers were involved. I ask them to resist the Amendment in the knowledge, also, that when, as surely will he the case, lowest-paid worker criteria are presented to the Government as a reason for allowing a pay increase to go through despite the period and the policy, it will be operated in that case. When, whether it comes from a wages council or some other source, the case is put, "We want exemption because the men in this category are lowest-paid workers", the exemption will be granted. Exemption may be not specific or overt, or diagnosed as a precise part of the agreement, but one of the reasons why such a wage increase will be allowed is that the Government know that, with this additional burden on them, the lowest-paid workers must be given special concessions to enable them to meet those burdens.

Mr. R. Carr

When the hon. Gentleman spoke about the three alternatives that he saw I began to think that he was going to recommend his colleagues on the Front Bench to abstain in the forthcoming Division. When the House heard his concluding remarks about the Government's sensitivity to and concern for the problems of the lower-paid workers and the complicated way in which he could not say yes to the Amendment but nevertheless these matters would be taken into account, we were getting near the heart of the reason why the policy which the Government are pursuing will not be understood and will not be accepted. People concerned with these matters are well able to understand the basic affairs of the country in its economic situation and all the rest of it, but they do expect, and have a right to expect, fairly clear answers from the Government to fairly clear questions. This is the one thing they are not getting on this or other matters.

The House should be grateful to hon. Gentlemen opposite for moving the Amendment. We were deprived of their contribution in Standing Committee. I know that I must not comment on that, but, as my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) said, it was left entirely to those of us on this side to press this point upstairs, and it has been valuable to the House to have this debate initiated by hon. Gentlemen opposite today.

Like my hon. Friend the Member for Weston-super-Mare (Mr. Webster), however, I regret the way in which the hon. Gentleman the Member for Tottenham (Mr. Atkinson) seems to find it necessary to square his conscience for doing things like this and opposing his own Front Bench by casting aspersions on all on this side. He says he would believe in our sincerity had it not been for the 13 years of Tory Government.

Mr. Robert Maxwell (Buckingham)

Hear, hear.

Mr. Carr

I would be very happy if the hon. Member for Buckingham (Mr. Maxwell), who has just arrived, and the hon. Member for Tottenham would come among my constituents and say that sort of thing, because, like many hon. Members, I am finding that many people who fell victim to the talk of 13 years of Tory misrule would now be delighted to have some more of it, because they know, including the lowest-paid workers and recipients of benefits, that they did better year in, year out, in the 13 years than they have done in the last three years, or look like doing in the future.

We doubt whether the problem of the lower-paid workers can be dealt with by means of this or any other incomes policy. It is a matter largely to be determined by policies which we cannot talk about tonight—social service policies. Whether that be so or not, we have not yet had those other policies from the Government. We have had from the Government a double claim for their policy: first, the claim that their incomes policy would take special account of the lower-paid workers, and secondly, their more general claim that this policy is meant to encourage fairness in the wages and salaries structure throughout the county. That it is not doing. It is not encouraging; it is not bringing about fairness. On the contrary, there is plenty of evidence that it is doing the reverse. It is causing changes in relative wages and in certain differentials in the most arbitrary manner which has no connection with any recognisable principle of fairness.

When the Parliamentary Secretary, having advised his hon. Friends to turn down the Amendment, speaks of special concessions to lower-paid workers, one can think only that he means special concessions as long as they are not as much as 2s. a week, which is what is involved in the Amendment. We have heard from the Government that in considering prices, increases in taxation—the effect of the Selective Employment Tax, for example—can be and have been, with the Government's approval, taken into account. Earlier today, my hon. Friend the Member for Gillingham (Mr. Burden) quoted the example—we can all find many more—of a bill which he had had in a British Railways hotel in which this nationalised industry had added a special surcharge to take account of increased tax and had done so with the blessing of the Government. But, surely, this is a tax on workers' wages which affects all of us, however much we earn, but which is particularly felt by the lower-paid workers.

One cannot help contrasting the Government's attitude to this Amendment with the recent speech by the Chancellor of the Exchequer—the "Sunny Jim" speech it was dubbed in the Press—when we gathered that all this gloom was coming to an end and that everybody could look forward to rising standards of living.

There is another aspect of the unfairness which the House will want to take into account and which is that while the Government are saying categorically that this element of the increase in National Insurance contributions cannot specifically be taken into account, there are hundreds of thousands of workers of one kind or another who are not members of unions, who are employed individually or in small numbers, and who are not dealt with by the sort of agreements which have come under surveillance in this policy and who will undoubtedly get the benefit of this sort of help from their employers. I am sure that we shall again see, as we have seen in the Orders which have come forward under the 1966 Act, that this policy bites arbitrarily and unfairly particularly on members of trade unions.

But it is not only for lower-paid workers that the Amendment is important. It is also important to the Government's basic incomes policy. In Committee we pressed hard to get certainty. We made it clear that if we were to move, as the Government claim that we are trying to move, to a voluntary system in which people would voluntarily follow the Government's lead and do what the Government believed to be in the national interest, it was extremely important that those who had to make decisions should be clear about what was and what was not in line with what the Government had to say.

While we realise that there are many factors which must come into decisions about prices and incomes and which are indeterminate and outside the control of the Government, here is a matter of an increase in tax, or an increase in

contributions, which is definite and within the control of the Government and it is therefore a matter about which those who have to operate this policy both could and should expect to hear from the Government a very clear and definite answer.

In Committee we pressed and pressed to get it, and eventually we got a "No". Before that "No" could be explored, the Government moved the Closure. The House ought not to accept that "No" from the Parliamentary Secretary tonight. Therefore, because of the effect on the lower-paid workers and because the Government have put forward no other means of coping with their problems and because of the effect of the Bill on any claim by the Government to be moving towards a genuine voluntary policy, I must advise my right hon. and hon. Friends to vote for the Amendment.

Mr. Whitlock rose in his place and claimed to move, That the Question be now put:—

Question put, That the Question be now put.

The House divided: Ayes 151, Noes 117.

Division No. 434.]	AYES	[12.45 a.m.
Alldritt, Walter	Dewar, Donald	Hunter, Adam
Armstrong, Ernest	Diamond, Rt. Hn. John	Hynd, John
Ashley, Jack	Doig, Peter	Jackson, Colin (B'h'se & Spenb'gh)
Atkins, Ronald (Preston, N.)	Eadie, Alex	Jeger, Mrs. Lena (H'b'n&St. P'cras, S.)
Bacon, Rt. Hn. Alice	Edwards, Robert (Bilston)	Johnson, James (K'ston-on-Hull, W.)
Bagier, Gordon A. T.	Ellis, John	Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Barnes, Michael	English, Michael	Jones, T. Alec (Rhondda, West)
Baxter, William	Ennals, David	Judd, Frank
Bence, Cyril	Ensor, David	Lawson, George
Benn, Rt. Hn. Anthony Wedgwood	Evans, loan L. (Birm'h'm, Yardley)	Leadbitter, Ted
Binns, John	Fernyhough, E.	Ledger, Ron
Bishop, E. S.	Forrester, John	Lee, Rt. Hn. Frederick (Newton)
Blackburn, F.	Fowler, Gerry	Lewis, Ron (Carlisle)
Bradley, Tom	Fraser, John (Norwood)	Lomas, Kenneth
Bray, Dr. Jeremy	Fraser, Rt. Hn. Tom (Hamilton)	Loughlin, Charles
Brooks, Edwin	Freeson, Reginald	Lyon, Alexander W. (York)
Brown, Rt. Hn. George (Bolper)	Gardner, Tony	Lyons, Edward (Bradford, E.)
Brown, Hugh D. (G'gow, Provan)	Gray, Dr. Hugh (Yarmouth)	McBride, Neil
Brown, Bob (N 'c'tle-upon-Tyne, W)	Gregory, Arnold	MacColl, James
Brown, R. W. (Shoreditch & F'bury)	Grey, Charles (Durham)	MacDermot, Niall
Buchan, Norman	Hamilton, James (Bothwell)	Mackenzie, Gregor (Rutherglen)
Buchanan, Richard (G'gow, Sp'burn)	Hannan, William	Mackintosh, John P.
Callaghan, Rt. Hn. James	Harrison, Walter (Wakefield)	Maclennan, Robert
Carmichael, Neil	Hart, Mrs. Judith	McMillan, Tom (Glasgow, C.)
Coe, Denis	Haseldine, Norman	McNamara, J. Kevin
Coleman, Donald	Hattersley, Roy	Mallalieu, J. P. W. (Huddersfield, E.)
Conlan, Bernard	Hazell, Bert	Manuel, Archie
Crawshaw, Richard	Henig, Stanley	Mapp, Charles
Crosland, Rt. Hn. Anthony	Herbison, Rt. Hn. Margaret	Marquand, David
Crossman, Rt. Hn. Richard	Hooley, Frank	Mason, Roy
Dalyell, Tam	Howarth, Robert (Bolton, E.)	Maxwell, Robert
Davidson, Arthur (Accrington)	Howell, Denis (Smalt Heath)	Millan, Bruce
Davies, Harold (Leek)	Howie, W.	Milne, Edward (Blyth)
Dell, Edmund	Hoy, James	Morris, Charles R. (Openshaw)
Dempsey, James	Huckfield, L.	Morris, John (Aberavon)
Murray, Albert	Rose, Paul	Wells, William (Walsall, N.)
Noel-Baker, Francis (Swindon)	Shaw, Arnold (llford, S.)	White, Mrs. Eirene
Oakes, Gordon	Shore, Peter (Stepney)	Whitlock, William
Ogden, Eric	Short, Mrs. Renée (W'hampton, N. E,)	Willey, Rt. Hn. Frederick
O'Malley, Brian	Silkin, Rt. Hn. John (Deptford)	Williams, Alan (Swansea, W.)
Owen, Dr. David (Plymouth, S'tn)	Silverman, Julius (Aston)	Williams, Alan Lee (Hornchurch)
Page, Derek (King's Lynn)	Slater, Joseph	Williams, Mrs. Shirley (Hitchin)
Paget, R. T.	Stewart, Rt. Hn. Michael	Willis, George (Edinburgh, E.)
Parkyn, Brian (Bedford)	Summerskill, Hn. Dr. Shirley	Wilson, William (Coventry, S.)
Pavitt, Laurence	Swingler, Stephen	Winterbottom, R. E.
Pentland, Norman	Taverne, Dick	Woodburn, Rt. Hn. A.
Rees, Merlyn	Tinn, James	Woof, Robert
Reynolds, G. W.	Urwin, T. W.
Roberts, Albert (Normanton)	Wainwright, Edwin (Dearne Valley)	TELLERS FOR THE AYES:
Roberts, Gwilym (Bedfordshire, S.)	Walker, Harold (Doncaster)	Mr. Alan Fitch and
Robinson, W. O. J. (Walth'stow, E.)	Watkins, David (Consett)	Mr. Joseph Harper.
Roebuck, Roy	Watkins, Tudor (Brecon & Radnor)
NOES
Alison, Michael (Barkston Ash)	Heseltine, Michael	Pardoe, John
Allason, James (Hemel Hempstead)	Higgins, Terence L.	Peel, John
Astor, John	Hiley, Joseph	Percival, Ian
Atkins, Humphrey (M't'n & M'd'n)	Hill, J. E. B.	Pink, R. Bonner
Baker, W. H. K.	Hirst, Geoffrey	Price, David (Eastleigh)
Biffen, John	Holland, Philip	Prior, J. M. L.
Boyle, Rt. Hn. Sir Edward	Hordern, Peter	Pym, Francis
Brewis, John	Howell, David (Guildford)	Renton, Rt. Hn. Sir David
Bromley-Davenport, Lt. -Col. Sir Walter	Hunt, John	Ridley, Hn, Nicholas
Brown, Sir Edward (Bath)	Hutchison, Michael Clark	Royle, Anthony
Bruce-Gardyne, J.	Iremonger, T. L.	Russell, Sir Ronald
Carr, Rt. Hn. Robert	Jenkin, Patrick (Woodford)	Scott, Nicholas
Chichester-Clark, R.	Johnson Smith, G. (E. Grinstead)	Sharpies, Richard
Clegg, Walter	Jopting, Michael	Shaw, Michael (Sc'b'gh & Whitby)
Corfield, F. V.	Kaberry, Sir Donald	Sinclair, Sir George
Dance, James	Kershaw, Anthony	Smith, John
Dean, Paul (Somerset, N.)	Kimball, Marcus	Stoddart-Scott, Col. Sir M. (Ripon)
Deedes, Rt. Hn. W. F. (Ashford)	King, Evelyn (Dorset, S.)	Taylor, Sir Charles (Eastbourne)
Dodds-Parker, Douglas	Kirk, Peter	Taylor, Edward M. (G'gow, Cathcart)
Eden, Sir John	Kitson, Timothy	Taylor, Frank (Moss Side)
Elliott, R. W. (N'c'tle-upon-Tyne, N.)	Knight, Mrs. Jill	Thatcher, Mrs. Margaret
Emery, Peter	Lambton, Viscount	Turton, Rt. Hn. R. H.
Errington, Sir Eric	Lewis, Kenneth (Rutland)	van Straubenzee, W. R.
Eyre, Reginald	Lubbock, Eric	Wainwright, Richard (Colne Valley)
Fisher, Nigel	MacArthur, Ian	Walker, Peter (Worcester)
Fletcher-Cooke, Charles	Macleod, Rt. Hn. lain	Ward, Dame Irene
Fortescue, Tim
Fraser, Rt. Hn. Hugh (St'fford& Stone)	Maude, Angus	Weatherill, Bernard
Gilmour, Sir John (Fife, E.)	Mawby, Ray	Webster, David
Glover, Sir Douglas	Maxwell-Hyslop, R. J.	Wells, John (Maidstone)
Glyn, Sir Richard	Maydon. Lt.-Cmdr. S. L. C.	Whitelaw, Rt. Hn. William
Goodhew, Victor	Mills, Peter (Torrington)	Wilson, Geoffrey (Truro)
Gower, Raymond	Miscampbell, Norman	Winstanley, Dr. M. P.
Grant, Anthony	More, Jasper	Wolrige-Gardon, Patrick
Grant-Ferris, R.	Morrison, Charles (Devizes)	Wright, Esmond
Griffiths, Eldon (Bury St. Edmunds)	Munro-Lucas-Tooth, Sir Hugh	Wylie, N. R.
Gurden, Harold	Murton, Oscar	Younger, Hn. George
Harris, Reader (Heston)	Noble, Rt. Hn. Michael
Harvie Anderson, Miss	Onslow, Cranley	TELLERS FOR THE NOES:
Hawkins, Paul	Page, Graham (Crosby)	Mr. David Mitchell and
Heald, Rt. Hn. Sir Lionel	Page, John (Harrow, W.)	Mr. Hector Monro.

Question put accordingly, That the proposed words be there inserted in the Bill:—

The House divided: Ayes 118, Noes 151.

Division No. 435.]	AYES	[12.54 a.m.
Alison, Michael (Barkston Ash)	Chichester-Clark, R.	Fletcher-Cooke, Charles
Allason, James (Hemel Hempstead)	Clegg, Walter	Fortescue, Tim
Astor, John	Corfield, F. V.	Fraser, Rt. Hn. Hugh (St'fford& Stone)
Atkins, Humphrey (M't'n & M'd'n)	Dance, James	Gilmour, Sir John (Fife, E.)
Baker, W. H. K.	Dean, Paul (Somerset, N.)	Glover, Sir Douglas
Balniel, Lord	Deedes, Rt. Hn. W. F. (Ashford)	Glyn, Sir Richard
Biffen, John	Dodds-Parker, Douglas	Goodhew, Victor
Boyle, Rt. Hn. Sir Edward	Eden, Sir John	Gower, Raymond
Brewis, John	Elliott, R. W. (N'c'tle-upon-Tyne, N.)	Grant, Anthony
Bromley-Davenport, Lt. -Col. Sir Walter	Emery, Peter	Grant-Ferris, R.
Brown, Sir Edward (Bath)	Errington, Sir Eric	Griffiths, Eldon (Bury St. Edmunds)
Bruce-Gardyne, J.	Eyre, Reginald	Gurden, Harold
Carr, Rt. Hn. Robert	Fisher, Nigel	Harris, Reader (Heston)
Harvie Anderson, Miss	Macleod, Rt. Hn. Iain	Shaw, Michael (Sc'b'gh & Whitby)
Hawkins, Paul	Maude, Angus	Sinclair, Sir George
Heald, Rt. Hn. Sir Lionel	Mawby, Ray	Smith, John
Heseltine, Michael	Maxwell-Hyslop, R. J.	Stoddart-Scott, Col. Sir M. (Ripon)
Higgins, Terence L.	Maydon, Lt.-Cmdr. S. L. C.	Taylor, Sir Charles (Eastbourne)
Hiley, Joseph	Mills, Peter (Torrington)	Taylor, Edward M. (G'gow, Cathcart)
Hill, J. E. B.	Miscampbell, Norman	Taylor, Frank (Moss Side)
Hirst, Geoffrey	More, Jasper	Thatcher, Mrs. Margaret
Holland, Philip	Morrison, Charles (Devizes)	Turton, Rt. Hn. R. H.
Hordern, Peter	Munro-Lucas-Tooth, Sir Hugh	van Straubenzee, W. R.
Howell, David (Guildford)	Murton, Oscar	Wainwright, Richard (Colne valley)
Hunt, John	Noble, Rt. Hn. Michael	Walker, Peter (Worcester)
Hutchison, Michael Clark	Onslow, Cranley	Ward, Dame Irene
Iremonger, T. L.	Page, Graham (Crosby)	Weatherill, Bernard
Jenkin, Patrick (Woodford)	Page, John (Harrow, W.)	Webster, David
Johnson Smith, C. (E. Grinstead)	Pardoe, John	Wells, John (Maidstone)
Jopling, Michael	Peel, John	Whitelaw, Rt. Hn. William
Kaberry, Sir Donald	Percival, Ian	Wilson, Geoffrey (Truro)
Kershaw, Anthony	Pink, R. Bonner	Winstanley, Dr. M. P.
Kimball, Marcus	Price, David (Eastleigh)	Wolrige-Gordon, Patrick
King, Evelyn (Dorset, S.)	Prior, J. M. L.	Wright, Esmond
Kirk, Peter	Pym, Francis	Wylie, N. R.
Kitson, Timothy	Renton, Rt. Hn. Sir David	Younger, Hn. George
Knight, Mrs. Jill	Ridley, Hn. Nicholas
Lambton, Viscount	Royle, Anthony	TELLERS FOR THE AYES:
Lewis, Kenneth (Rutland)	Russell, Sir Ronald	Mr. David Mitchell and
Lubbock, Eric	Scott, Nicholas	Mr. Hector Monro.
Mac Arthur, Ian	Sharples, Richard
NOES
Alldritt, Walter	Freeson, Reginald	Milne, Edward (Blyth)
Armstrong, Ernest	Gardner, Tony	Morris, Charles R. (Openshaw)
Ashley, Jack	Garrett, W. E.	Morris, John (Aberavon)
Atkins, Ronald (Preston, N.)	Gray, Dr. Hugh (Yarmouth)	Murray, Albert
Bacon, Rt. Hn. Alice	Gregory, Arnold	Noel-Baker, Francis (Swindon)
Bagier, Gordon A. T.	Grey, Charles (Durham)	Oakes, Gordon
Barnes, Michael	Hamilton, James (Bothwell)	Ogden, Eric
Baxter, William	Hannan, William	O'Malley, Brian
Bence, Cyril	Harrison, Walter (Wakefield)	Owen, Dr. David (Plymouth, S'tn)
Benn, Rt. Hn. Anthony Wedgwood	Hart, Mrs. Judith	Page, Derek (King's Lynn)
Binns, John	Haseldine, Norman	Parkyn, Brian (Bedford)
Bishop, E. S.	Hattersley, Roy	Pavitt, Laurence
Blackburn, F.	Hazell, Bert	Pentland, Norman
Bradley, Tom	Henig, Stanley	Rees, Merlyn
Bray, Dr. Jeremy	Herbison, Rt. Hn. Margaret	Reynolds, G. W.
Brooks, Edwin	Hooley, Frank	Roberts, Albert (Normanton)
Brown, Rt. Hn. George (Belper)	Howarth, Robert (Bolton, E.)	Roberts, Gwilym (Bedfordshire, S.)
Brown, Hugh D. (G'gow, Provan)	Howell, Denis (Small Heath)	Robinson, W. O. J. (Walth'stow, E.)
Brown, Bob (N'c'tle-upon-Tyne, W)	Howie, W.	Roebuck, Roy
Brown, R. W. (Shoreditch & F'bury)	Hoy, James	Rose, Paul
Buchan, Norman	Huckfield, L.	Shaw, Arnold (Ilford, S.)
Buchanan, Richard (G'gow, Sp'burn)	Hunter, Adam	Shore, Peter (Stepney)
Callaghan, Rt. Hn. James	Hynd, John	Short, Mrs. René e (W'hampton, N. E.)
Carmichael, Neil	Jackson, Colin (B'h'se & Spenb'gh)	Silkin, Rt. Hn. John (Deptford)
Coe, Denis	Johnson, James (K'ston-on-Hull, W.)	Slater, Joseph
Coleman, Donald	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Stewart, Rt. Hn. Michael
Conlan, Bernard	Jones, T. Alec (Rhondda, West)	Summerskill, Hn. Dr. Shirley
Crawshaw, Richard	Judd, Frank	Swingler, Stephen
Crosland, Rt. Hn. Anthony	Lawson, George	Taverne, Dick
Crossman, Rt. Hn. Richard	Leadbitter, Ted	Tinn, James
Dalyell, Tam	Ledger, Ron	Urwin, T. W.
Davidson, Arthur (Accrington)	Lee, Rt. Hn. Frederick (Newton)	Wainwright, Edwin (Dearne Valley)
Davies, Harold (Leek)	Lewis, Ron (Carlisle)	Walker, Harold (Doncaster)
Dell, Edmund	Lomas, Kenneth	Watkins, David (Consett)
Dempsey, James	Loughlin, Charles	Watkins, Tudor (Brecon & Radnor)
Dewar, Donald	Lyon, Alexander W. (York)	Wells, William (Walsall, N.)
Diamond, Rt. Hn. John	Lyons, Edward (Bradford, E.)	White, Mrs. Elrene
Doig, Peter	McBride, Neil	Whitlock, William
Dunn, James A.	MacColl, James	Willey, Rt. Hn. Frederick
Dunwoody, Mrs. Gwyneth (Exeter)	MacDermot, Niall	Williams, Alan (Swansea, W.) Williams, Alan Lee (Hornchurch)
Dunwoody, Dr. John (F'th & C'b'e)	Mackenzie, Cregor (Rutherglen)
Eadie, Alex	Mackie, John	Williams, Mrs. Shirley (Hitchin)
Edwards, Robert (Bilston)	Mackintosh, John P.	Willis, George (Edinburgh, E.)
English, Michael	Maclennan, Robert	Wilson, William (Coventry, S.)
Ennals, David	McMillan, Tom (Glasgow, C.)	Winterbottom, R. E.
Ensor, David	Mallalieu, J. P. W. (Huddersfieid, E.)	Woodburn, Rt. Hn. A.
Evans, Ioan L. (Birm'h'm, Yardley)	Manuel, Archie	Woof, Robert
Fernyhough, E.	Mapp, Charles
Forrester, John	Marquand, David	TELLERS FOR THE NOES:
Fowler, Gerry	Mason, Roy
Fraser, John (Norwood)	Maxwell, Robert	Mr. Alan Fitch and
Fraser, Rt. Hn. Tom (Hamilton)	Millan, Bruce	Mr. Joseph Harper.

Mr. Ian Macleod

I beg to move, That further consideration of the Bill, as amended, be now adjourned. I move this Motion partly in a spirit of inquiry and partly in a spirit of complaint. The inquiry is the ordinary inquiry which is always made about this time of night, if indeed not earlier, as to what are the intentions of the Government and how far they think we might reasonably go tonight. We shall not undertake to fall in with their wishes, but it would at least be interesting to hear them.

Secondly, on the spirit of complaint, I think that the House of Commons has been disgracefully treated by the Government and particularly by the Leader of the House. [HON. MEMBERS: "Where is he?"] We can perhaps develop at leisure the question where he is, and I think that it would be difficult for him not to make some appearance in response to it in due course.

When the Leader of the House announced the business for Monday of this week, representations were made at once through the usual channels that it was quite intolerable to expect, as was originally suggested on Thursday, that we should take the affirmative Order for Part II, then the whole of the Report stage of an extremely contentious Bill, and then the Third Reading. On the Business statement my right hon. Friend the Leader of the Opposition and I both pressed the Leader of the House on this. His reply was typical of him. He said that we would just see how we got on. He then waited till the next day when the Whips had gone out and the House had dispersed, and he changed the business. He changed the order of business by putting the Bill first and the affirmative Order second. I think that that is the first instance of intolerable treatment of the House of Commons by the Leader of the House.

Secondly, we have now embarked upon the Report stage of the Bill. We have not yet completed consideration of Clause 1, and the last two Amendments—one moved from each side of the House—were divided on only with the aid of the Closure and steadily dwindling majorities.

What is more important is that the attitude of hon. Members on both sides has been transformed by the speech which the Leader of the House made over the weekend. It was an arrogant and disdainful speech that was quite impossible to explain away, in spite of the two announcements which I understand have already gone out from Labour Party headquarters.

If, on a matter being discussed by the House, the Leader of the House wishes to say that he was misrepresented or misreported—this happens to us all, he should do it in the House. The invitation to do so has been issued to him repeatedly from both sides. It has been conveyed to him by the Chief Whip, or, rather, it was conveyed to him with strict instructions that under no condition was he to put his face inside the House, because he might have something lo answer for. The rest of the House is left, with the speech unexplained and inexplicable, to do what it can with the Bill.

It is not possible to take a proper attitude on the question of how long the Bill should remain on the Statute Book once it is an Act unless we have an explanation of the Leader of the House's speech We expected to get it in response to the debate on Amendment 11 from the First Secretary. We waited patiently through a very long reply, but he never mentioned the subject from beginning to end. I can understand that. I do not doubt that he is very angry with his right hon. Friend the Leader of the House for making such, a silly speech, and so are we. But that is no reason why these matters should not be properly debated in the House.

Those are all formidable reasons why we should not proceed further with the Bill tonight, but there are others. One reason always advanced for going further with a Bill at other than a normal hour of the evening or night is the question of time. But time is the one thing this Leader of the House is lavish with on every Bill—except the most important in this Session. All sorts of other Bills, most of which I happen to favour—but that is irrelevant—arouse strong feelings on both sides of the House and both sides of the questions involved. Time is promised for those Bills, and we must try to shuffle through this enormously important Bill on the original plan of one day and, presumably, a longish night's sitting.

If the Leader of the House will behave like this, at least he should have enough valour to come here and defend himself. It is not reasonable for him to sneak around the Palace of Westminster to vote occasionally, and decline to explain both his speech and his handling of the business of the House, and particularly the Bill. The right place to explain—if the Foreign Secretary would like to go to bed, will he please go?

The Secretary of State for Foreign Affairs (Mr. George Brown)

It almost sounded as if the right hon. Gentleman meant it.

Mr. Macleod

I have heard the right hon. Gentleman move enough of these Motions in my day. I just do them rather better.

I have no doubt that the Leader of the House should now come here. I am sure that the Chief Whip can get him from whatever corner he may be skulking in and bring him here.

No doubt my hon. Friends will wish to advance many more reasons why we should not go forward with the Bill at this time. I do not think we shall make very much more progress on the Bill if the House is treated like this. If hon. Members feel that the Leader of the House is staying away from the House because he is afraid of the House of Commons, it is unreasonable to expect them to make dramatic or, indeed, any progress with the Bill.

There is no need for the First Secretary to reply at once. I am sure that of her hon. Members wish to develop this point, and the First Secretary is always more effective in speaking when he has listened to the arguments. I am sure that it is the view of many of my right hon. and hon. Friends that from the beginning we have been asked to undertake an impossible action and that the House has been uncivilly treated by the changing of the order of business and the lamentably small amount of time given to possibly the most important Bill of the Session. We should not, therefore, carry on with the debate tonight.

Mr. Michael Jopling (Westmorland)

I speak in favour of the Motion, not from any personal point of view, which perhaps some hon. Members have every justification in doing, because I was not able to attend the House last week after the Foreign Secretary, whom I am glad to see in his place, did his best to poison me at a reception which he gave—

Mr. George Brown

Sorry I did not succeed!

Mr. Jopling

The Foreign Secretary seems to go round the world making enemies. It is a pity that he should continue doing so in the House.

There is one important reason why the House should rise now. I draw attention to item No. 4 on the Order Paper which is a matter which the House should reach as soon as possible so that leave may be given to the Select Committee on Agriculture to hold sittings in Brussels. Until this business is passed, the Select Committee, which has been doing a great deal of hard work upstairs, will not be able—

Mr. Speaker

Order. With the utmost tolerance, I cannot see how the hon. Gentleman can link what he is saying with the Motion.

Mr. Jopling

With the greatest respect, I will come to the point when I explain the position concerning the Select Committee.

It is essential that the Motion concerning the Select Committee should be passed at an early hour because it is the intention of a number of members of the Select Committee to travel to Brussels later this morning. I do not intend to move the adjournment of the House under Standing Order No. 9, but it might be that one would have to consider doing so at a later stage.

1.15 a.m.

It is essential that members of the Select Committee should go to Brussels as soon as possible because the Committee has to report to the House by the end of this Session, and time is running extremely short. The Select Committee has been trying to get to Brussels for a long time. It is essential for the work of the Committee that members of it should go to Brussels as early as possible.

In a few hours a number of hon. Members who are members of the Select Committee on Agriculture will have to leave for Brussels. Unless Motion No. 4 on the Order Paper is passed, they will not be able to go. It would be a tragedy if the new business which the House has embarked upon in the Select Committee upstairs were not allowed to proceed, particularly since important arrangements have been made in Brussels for hon. Members to meet both the British Mission and the Commission. The Chairman of the Committee, the hon. Member for Brecon and Radnor (Mr. Watkins), is in his place and is waiting to move the Motion. I trust that the Government will agree to the Motion.

Mr. Speaker

I apologise to the hon. Gentleman for calling him to order earlier. He was completely in order.

Mr. Peter Emery (Honiton)

In urging the Government to accept the Motion, I remind them that the next group of Amendments is of the greatest importance and will take a considerable time to discuss. The Government should call a halt now, and allow hon. Members to start again refreshed—perhaps with larger ranks on the benches opposite—so that we may properly tackle the subject of productivity, to which the following Amendments refer.

I, too, wish to refer to the Leader of the House. [HON. MEMBERS: "Where is he"?] It must be embarrassing to the Government Front Bench not to have the right hon. Gentleman here. The objection to the Motion appears to be based on the fact that the right hon. Gentlemen opposite are not sure whether or not the Leader of the House would be with them, and—[Interruption.]

Mr. Speaker

Order. I want to hear why the House should adjourn consideration of the Prices and Incomes (No. 2) Bill.

Mr. Emery

The latest reports are that the Leader of the House has issued, or has had issued, from Transport House an entirely different interpretation of some words in his recent speech, an interpretation different from that which we had at the start of this debate. I read on the tape that the use of the word "medicine"—the word which has been so much in people's minds—had nothing to do with Part IV or Part II of the Bill, but referred completely and absolutely to the unpleasant fact of unemployment. If this is so—and it must be so; the right hon. Gentleman would not have said so otherwise—it seems to make his speech even more damaging. It means that the right hon. Gentleman is now suggesting that the Government, as a matter of policy—because it was a matter of policy that he was considering giving the medicine to the British electorate—are considering massive unemployment. This is an even worse—[Interruption.]

Mr. Speaker

Order. We cannot get into a debate on the merits of a speech by the Leader of the House, except in so far as it is a reason for adjourning consideration of the Bill.

Mr. Emery

Thank you for your guidance, Mr. Speaker. May I follow it by saying that my reason for raising this point and explaining it is that in my view the Leader of the House needs to explain completely a speech which so affects this Bill, and which has been given an interpretation completely different from that which we have heard from the Treasury Bench in these debates.

If the Leader of the House were fulfilling some appointment outside London, one would not press this point, but when he is in the building, as I know from having seen him only a matter of an hour ago—[HON. MEMBERS: "Oh."]— it seems to me to be a matter—[Interruption.]

Mr. Speaker

Order. Let us get back to doing what we can in a Parliamentary way.

Mr. Emery

I welcome the appearance of the Leader of the House, and I will immediately cut short my speech—[Interruption.]—in the hope that the right hon. Gentleman will seek to answer the point made by many hon. Members that we should not continue this debate on the Bill until we have had a complete interpretation, yet again, of his speech which, at the moment, appears to have three different meanings, according to the Press. Then, and then only, will we be able to proceed properly with a full discussion of the other Amendments.

Sir D. Glover

I support the Motion moved by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod). I want to give various reasons why I think the debate should now be adjourned, and to raise some points that have not so far been made.

Since the Leader of the House has just come in, and so did not hear my hon. Friend the Member for Westmorland (Mr. Jopling), it is worth repeating that one of the reasons why the House should now adjourn further discussion of the Bill is that if the fourth item on the Order Paper is not reached today it will create a great deal of embarrassment for the Select Committee on Agriculture which wants to go to Brussels and must have the Order approved in order to do so. I am sure that the Foreign Secretary, who probably went out and got the Leader of the House to come in to listen to the debate, would be very embarrassed if, as a result of this debate on the Bill, the Select Committee were not able to proceed to Brussels.

My main point is that the Leader of the House, who has shown during the last two Sessions that he is probably the most incompetent Leader of the House we have seen for a very long time, altered our procedure so that on Mondays and Wednesdays the official business of the House was due to finish at half-past nine. I admit that that was considered to be inconvenient and has therefore recently been altered to ten o'clock, but the fact is that the House has now been sitting since ten o'clock on Monday morning till twenty-five past one on Tuesday morning, and we are still debating what is perhaps the most important Bill of the Session.

This is complete incompetence on the part of the Leader of the House. He is treating Members, and particularly back benchers, with contempt, and without any consideration at all. He is not only treating the Members of the House with contempt but he is also creating a very great and serious problem in connection with the staff on the premises. We are having more and more night sittings now than we have had since the very early days when I came to the House.

I go so far as to say that, leaving aside the Finance Bill, we are now staying longer hours in the House than we have done, despite all the alterations of procedure, during the last 10 years. This is all under the leadership of the right hon. Gentleman.

Mr. Speaker

Order. The hon. Member must concentrate on this particular night.

Sir D. Glover

I appreciate that, Mr. Speaker. The Bill is one of the most important Bills, if not the most important Bill, that the House has debated this Session. There are very strong feelings on both sides, and I am sure that I carry a great many hon. Members below the Gangway opposite with me on this. [AN HON. MEMBER: "YOU do not carry anyone."] There is great feeling on both sides about the implications of the Bill. Therefore, however the business of the House is organised, it will be—and it should be—a long debate on all the Amendments on Report.

We have been debating the Bill from half-past three until half-past one. It cannot be said that there has been an irrelevant speech throughout the whole of the Bill—[Interruption.]—with the notable exception of some of the replies from the Government Front Bench. It has been a thoughtful debate. The speeches have all been thoughtful, on both sides.

If the House is to do its business properly, the Government must realise that there is a point in time when the House is bound to deteriorate in its discussions. After nearly 12 hours, I reckon that the House has reached a point when, in common sense, if the Government want to maintain unity in their own party, if they want to maintain the reputation of having a grip on their legislative programme, they should accept the Motion, we should go home and the Leader of the House should show more competence and organise our business so that we finish at a reasonable hour of the night.

Sir W. Bromley-Davenport

I support the Motion which has been moved so admirably by my right hon. Friend the Member for Enfield, West (Mr. Iain Macleod). I wish to support the Motion —[Interruption.]

Mr. Speaker

Order. This is an important Parliamentary exercise. We do not want to spoil it by foolish noises.

Sir W. Bromley-Davenport

Thank you for your support, Mr. Speaker.

My reason for supporting the Motion is that the general level of speeches is deteriorating so rapidly—[HON. MEMBERS: "Hear, hear."] If I may continue, it is deteriorating so rapidly among members of the Government and the Lobby fodder of which it largely consists.

I wish to give some examples. Let me take the hon. Member for Tottenham (Mr. Atkinson) with his celebrated inaudible monologue. He was so exhausted —that was what it was. Added to that was the tripe he talked.

Mr. Speaker

Order. We cannot go back over previous debates.

1.30 a.m.

Sir W. Bromley-Davenport

I will not particularise. Unfortunately, Sir, you were not in the Chair when the hon. Member for Poplar (Mr. Mikardo) talked about taxation. That is all we got from him.

Mr. Speaker

Order. It is not in order to go back over the previous debates of the evening.

Sir W. Bromley-Davenport

I will give one final example. I will not talk any more about what anyone has said here. I will merely mention one recent example of behaviour which you, Sir, saw and which I saw and which could not have happened unless the person concerned had been exhausted. I refer to the Leader of the House—look at him now. I have never seen this happen before during my 20 years as a Member of the House. He sauntered in in that arrogant way of his, with his hands in his pockets—bad manners. Then he sat down and closed both his eyes. He must have been exhausted to do that.

Mr. Speaker

Order. We must continue the debate in a serious way. If the hon. and gallant Gentleman has nothing serious to say, he must resume his seat.

Sir W. Bromley-Davenport

I will not go any further, except to say, for those reasons, I support the Motion.

Mr. Nicholas Ridley (Cirencester and Tewkesbury)

It is always a pleasure to follow my hon. and gallant Friend the Member for Knutsford (Sir W. Bromley-Davenport), even though it will be difficult to maintain his high standard of contribution to this important debate.

My hon. Friend the Member for Westmorland (Mr. Jopling), in stating the reasons why the House should adjourn, was a little inclined to be selfish. Had he looked further down the Order Paper, he would have seen that also tonight the Motion That leave be given to Sub-Committee B of the Select Committee on Science and Technology to hold sittings in Europe must be moved. That Sub-Committee is not off this morning, but it is clear that the Select Committee on Agriculture is not the only Committee concerned.

Mr. Speaker

Order. If the Sub-Committee is not off this morning, perhaps the hon. Gentleman could come to the Motion before the House.

Mr. Ridley

I must also regretfully point out that the Motion concerning the gift of a Speaker's Chair to The Gambia is to be moved tonight. I do not know whether that is off tomorrow. It is clear that there is much important business to be completed this morning. If we are to take the rest of the Bill as well as the Order, it is very unlikely that the remainder of the Business will be reached.

The business of the House is grossly overloaded. We have had a whole series of all-night sittings in the last few weeks. It is likely that there will be two more this week, one on Wednesday on the Companies Bill and one on Thursday on the Medical Termination of Pregnancy Bill. What is more, in all probability there will be another next Monday, because the Leader of the House has announced that we are to debate the Coal Industry (Borrowing Powers) Order, which excites great interest on both sides of the House and which can certainly run till dawn or even till breakfast on Tuesday of next week. We are faced with three all-night sittings already. If we add another one tonight, it will make four in the short span of eight days. The fact that the Government have got themselves into such an unholy mess with their legislative programme is no reason to take it out of hon. Members and, what is worse, of the staff of the House. This has been the longest Session for many years. It has been going on for 18 months already. It seems quite wrong, having had such a whale of a Session, for the Government to introduce more and more legislation, rules, Orders and the rest.

Mr. Speaker

Order. It is only this piece of legislation that we can discuss tonight.

Mr. Ridley

I would certainly include the business for tonight in this long list of undigested legislation which is being unleashed upon the House at this late stage in the Session. The reason why we have morning sittings is to avoid late-night sittings of the sort which now faces us. Hon. Members, as well as the servants of the House, who man it at night, have a very just cause for complaint, because not only have we had the added burden of morning sittings, which many hon. Members on both sides of the House find extremely inconvenient, but at the same time there have been more all-night sittings than previously. This makes a fool of the House of Commons.

It is not admired and respected in the country. People think that this is a bad practice. They think that we cannot possibly be talking good sense at this hour of the night. They believe that we ought to find some way out of it. I want to make it abundantly clear that the blame for this state of affairs lies with the Government. If they had not brought in so much legislation we would not be sitting all night.

Mr. Speaker

Order. With respect, the hon. Gentleman can refer only to this particular business. He can refer to the other matters at some other time.

Mr. Ridley

I have no wish to pursue this, except to say that this particular al-night sitting will be the last straw which broke the camel's back. If the Government want to retrieve the position, and put themselves right in the eyes of the country, they would be far wiser not to proceed further, and to allow more time for this Bill by giving another day. Then perhaps we could regain the respect of the people, who think it unwise for the House to sit all night on so many occasions in the week. I therefore have great pleasure in supporting my right hon. Friend.

Mr. F. V. Corfield (Gloucestershire, South)

Would my hon. Friend repeat his speech for the benefit of the Leader of the House, who has been asleep throughout it?

Mr. M. Stewart

I do not think that the House would be well-advised to accept the Motion. The right hon. Gentleman the Member for Enfield, West (Mr. Iain Macleod), who moved it, said that it was moved, first of all, for information. He wanted to know what were the Government's intentions. At this stage it would be reasonable to say that the Government's intentions are to make further progress with the Bill, and to see how we go. We have a number of interesting and important Amendments, upon which hon. Members on both sides are well qualified to make contributions, whatever the hour.

Secondly, it was said that the Motion was moved in a spirit of complaint.

Mr. Iain Macleod

The First Secretary will appreciate that he had said that we should make further progress and that this is very different from the business as announced on Thursday, when it was said that we would take the Order and the Bill. The order of business has been reversed, but I am not on that point now. Would the First Secretary like to clarify what he has said? Would he be content to say whether the first Clause of the Bill will be taken, or has he any other alternative? The phrase that he has used is very different from that of the Leader of the House. We should like to know exactly where we stand.

Mr. Stewart

I can tell the right hon. Gentleman straight away that we will certainly get further than the first Clause. It would not be sensible to try to predict exactly where we shall get. It has been suggested by some hon. Members that all contributions have been relevant, and to the point. The hon. Member for Ormskirk (Sir D. Glover) said that it had been an evening of splendid speeches, and two minutes later the hon. and gallant Member for Knutsford (Sir W. Bromley-Davenport) said that speeches had begun to deteriorate. Both propositions commanded widespread agreement. We cannot say that the House is not in a condition to discuss this Bill reasonably.

As has been said, it is an important Bill. The Amendments, however, which lie in front of us do not now, as some of the earlier Amendments did, go over so wide a range of argument. We had the debate on one Amendment in which there was much reference to the speech of my right hon. Friend the Leader of the House, which was a general debate on the nature of prices and incomes policy and the relation of Government legislative powers to it. But really we have covered that point. The House, after ample time, did reach a decision on it. What lies ahead of us in the Amendments immediately to come are, I think, certain important but rather specialised points to which, in the interests of all the persons this Bill would affect, the House should get down and give speedy consideration.

This is a Bill which affects a number of people. It is not right that they should be left in uncertainty for a long time as to what the Bill should actually contain, and I think the House owes them a duty to get on with it. I do not think it can be maintained that the Government has not been reasonably generous in the time it has allowed the House to consider this Bill. We did, indeed, make provision for time in Committee which in the event the Opposition found they did not require on the scale that the Government would have been willing to provide. The Government can fairly say, therefore, that it was something of a surprise to see the number of Amendments—some of them covering points that either were or could have been raised in Committee—which went down on Report stage. It was partly in view of that that it did seem reasonable to change the order of business and to take the Report stage and the rather long list of Amendments first, and the Order thereafter.

Mr. Emery

I thank the right hon. Gentleman for giving way. Is it not a fact, when he talks about providing extra time for the Committee, that this was extra time to sit in the afternoon when the House was already sitting and that this would have been exceptionally inconvenient to hon. Members who wished—[HON. MEMBERS: "Oh."]—It is an argument that has been propounded by nearly every member of the Government Bench at other times, that this is most inconvenient.

Mr. Speaker

Order. Interventions must be brief.

Mr. Stewart

We would have been happy to sit on a Tuesday morning, but in the event it was found that neither side of the Committee thought it necessary to do so, and so I do not think that point is really valid. I say, therefore, that the Government have not been unreasonable in the provision of time for this Bill and it is now good sense, in view of the desirability of getting certainty for the many people this Bill will affect, that we should proceed as expeditiously as possible with the consideration of the Bill and the activating of Part II of the Act, a process which is bound up with the operation of the Bill itself.

I think, therefore, that on consideration the right hon. Gentleman the Member for Enfield, West will feel that the most reasonable course would be to withdraw this Motion and allow us to proceed with the Bill.

Mr. R. Carr

I must tell the First Secretary that on the reply he has given to us I am afraid we certainly take no such view at all as the one he has suggested.

My right hon. Friend moved this Motion partly to seek information and partly by way of complaint. The First Secretary has really addressed himself to neither of these complaints. The information he has given us is, to put it mildly, of the vaguest. One is used in this House to Ministers in charge of Bills replying to Motions of this kind in something other than the most precise terms, but I do not think I have ever heard more vague terms than those just used by the First Secretary. As to the complaint which so closely concerns the Leader of the House, I should have thought that the House might have been entitled to expect that we should have heard from him before we proceed with this business. That is a point to which I shall return in a moment in my brief remarks.

1.45 a.m.

I sum up why we feel that it is important at least to have much more definite information from the Government about how they propose to go on. There is the extremely important point about the Motion on the Order Paper regarding the Select Committee on Agriculture and its visit to Brussels. I know that there are still a number of hours left before the latest moment at which the House can pass the necessary Motion to enable it to go, but with the amount of business that we still have before us on the Bill it seems almost impossible to conceive that we could finish the whole of the Report stage of the Bill, let alone the Third Reading, in time for that Committee to get the permission that it needs to go away. I suggest very seriously to the House that it is not only for the convenience of the members of that Select Committee and of this House which they serve but it is also surely something of importance to the reputation of this country. When the House of Commons is sending a Committee to Brussels to investigate in these matters it does this country no good if it cannot turn up as expected because the Government have so bungled the business in the House of Commons that it is prevented from going.

There is also the fact, raised by several of my hon. Friends, that it is now 151 hours since the House started this sitting yesterday and we have now had no less than 11 hours on this Bill. In those 11 hours we have dealt with and disposed of five groups of Amendments. But there are still 13 groups of Amendments ahead of us. When the First Secretary says "We ask the House to continue a little longer", I think that the House is entitled to something a little more definite it the way of information from the Government before we proceed.

As my hon. Friends have said, it is not only hon. Members who are concerned in this. The staff of the House, of all sections of it, have just cause for complaint. We ought not to treat them in the way that the Government are forcing the House to treat them at the moment.

The main cause of our concern is, of course, with the Bill itself, because there is no need in our view for the rush in which the Bill is being taken by the Government. The White Paper on which it is based was published as long ago as March, and yet we had to wait until 5th June before the House was given a sight of the Bill. Having had the Second Reading on 13th June, the Government then said that it was so important that they must have the Committee stage completed not later than Tuesday, 4th July. It is somewhat hard when the Opposition have tried to assist the Government in that way then to have thrown across the Table by the First Secretary the suggestion that we did not need the time anyhow.

The Committee stage was steamrollered. It was steam-rollered in more than one sense. It was steam-rollered not only in the time that the Government wanted to allow to it and the fact that they insisted after only two sittings in the morning that we should sit in the afternoons as well, but also in the sense that, presumably through whatever processes these suggestions are made, we had on the Standing Committee no representatives of a large and important stream of opinion in the House—which is one of the reasons why we have so many Amendments on Report. You, Mr. Speaker, have recognised this by the very selection of the Amendments. The House must take into account that of the 18 groups of Amendments on the Notice Paper which we have to dispose of today a large proportion come not from the Opposition benches but from members on the Government side of the House—hon. Members opposite who, because none of them were chosen to serve on the Standing Committee, had no chance to put their views earlier.

Mr. Speaker

Order. The right how Gentleman may not pursue that argument much further. He must link it to reasons why we should adjourn consideration of the Bill.

Mr. Carr

I bow to your Ruling, Mr. Speaker and I apologise if I was transgressing. But it is for these reasons that we have these large groups of Amendments and they will need full discussion because they have not been aired in detail on the Bill before. We still have 13 of the 18 groups of Amendments ahead of us and it seems to us inconceivable that they can be completed in this sitting. For these reasons, again I say to the Government that they must give us more information about their proposals before we make progress.

Finally, I come to the question of the Leader of the House. I have been in this House for some 17 years—

Mr. George Brown

Poor fellow.

Mr. Carr

The Foreign Secretary has had longer of it than I have and I hope that we shall both have a good bit more. But perhaps he will agree with me that, in our experience of these matters, on both sides of the House, it has been usual for the Leader of the House of the day to be present whenever the House has got into great difficulty. It is not good for the House, and does not make a favourable impression or put people in the right spirit to co-operate, when we know that the Leader of the House is lurking on the premises and will not come in to be with us.

We suspected all the time that the Leader of the House was lurking on the premises and we believe that he voted in the last two Divisions. It is obvious that he came here in the end only because the Foreign Secretary, with his great experience and—let me say this quite genuinely to him—his feel for the House, felt that the time was long since past when the Leader of the House ought to be present. [Laughter.] Right hon. Members opposite may laugh if they like, but they should also take into account that the feelings I am expressing are more genuinely representative of the House as a whole than their attitude. They are not felt only on this side.

This would have been important even if the Leader of the House had not in any way been personally involved in today's business. But he is personally involved in it. This Bill was presented to us as a temporary Measure leading to a voluntary system. Then, over the weekend, the Leader of the House, on the

eve of our discussions of the Bill, made a speech in which, according to reports, he clearly indicated that it is unlikely to be voluntary at all. Statements are then made claiming that he is misreported and he himself makes a further statement saying that he was not referring to Part IV when he spoke of a lesson but to unemployment.

Whichever way we have it, those remarks of the Leader of the House were arrogant, offensive and have a big bearing on our debates today. I do not see how we can continue, let alone conclude, these debates until we know whether what he said does or does not represent Government policy and whether he was or was not misreported. If he was misreported, let him tell the House what he did say and not just issue statements through Transport House.

Several Hon. Members rose—

The Parliamentary Secretary to the Treasury (Mr. John Silkin) rose in his place and claimed to move, That the Question be now put:—

Question put, That the Question be now put.

The House divided: Ayes 163, Noes 114.

Division No. 436.]	AYES	[1.55 a.m.
Alldritt, Walter	Dempsey, James	Herbison, Rt. Hn. Margaret
Armstrong, Ernest	Dewar, Donald	Hooley, Frank
Ashley, Jack	Diamond, Rt. Hn. John	Howarth, Robert (Bolton, E.)
Atkins, Ronald (Preston, N.)	Doig, Peter	Howell, Denis (Small Heath)
Atkinson, Norman (Tottenham)	Dunn, James A.	Howie, W.
Bacon, Rt. Hn. Alice	Dunwoody, Mrs. Gwyneth (Exeter)	Hoy, James
Bagier, Gordon A. T.	Dunwoody, Dr. John (F'th & C'b'e)	Huckfield, L.
Barnes, Michael	Eadie, Alex	Hunter, Adam
Baxter, William	Ellis, John	Hynd, John
Bence, Cyril	English, Michael	Jackson, Colin (B'h'se & Spenb'gh)
Benn, Rt. Hn. Anthony Wedgwood	Ennals, David	Jeger, Mrs. Lena (H'b'n&St. P'crae, S.)
Bidwell, Sydney	Ensor, David	Johnson, James (K'ston-on-Hull, W.)
Binns, John	Evans, Ioan L. (Birm'h'm, Yardley)	Jones,Rt.Hn.Sir Elwyn(W.Ham,S.)
Bishop, E. S.	Fernyhough, E.
Blackburn, F.	Fletcher, Raymond (Ilkeston)	Jones, T. Alec (Rhondda, West)
Bradley, Tom	Foot, Michael (Ebbw Vale)	Judd, Frank
Bray, Dr. Jeremy	Forrester, John	Kerr, Russell (Feltham)
Brooks, Edwin	Fowler, Gerry	Lawson, George
Brown, Rt. Hn. George (Belper)	Fraser, John (Norwood)	Leadbitter, Ted
Brown, Hugh D. (G'gow, Provan)	Freeson, Reginald	Ledger, Ron
Brown, Bob (N'c'tle-upon-Tyne, W)	Gardner, Tony	Lee, Rt. Hn. Frederick (Newton)
Brown, R. W. (Shoreditch & F'bury)	Garrett, W. E.	Lee, John (Reading)
Buchan, Norman	Gray, Dr. Hugh (Yarmouth)	Lewis, Ron (Carlisle)
Buchanan, Richard (G'gow, Sp'bu n)	Gregory, Arnold	Lomas, Kenneth
Callaghan, Rt. Hn. James	Grey, Charles (Durham)	Loughlin, Charles
Carmichael, Neil	Hamilton, James (Bothwell)	Lyon, Alexander W. (York)
Coe, Denis	Hannan, William	Lyons, Edward (Bradford, E.)
Coleman, Donald	Harper, Joseph	MacColl, James
Conlan, Bernard	Harrison, Walter (Wakefield)	MacDermot, Niall
Crawshaw, Richard	Hart, Mrs. Judith	Mackenzie, Gregor (Rutherglen)
Crosland, Rt. Hn. Anthony	Haseldine, Norman	Mackie, John
Crossman, Rt. Hn. Richard	Hattersley, Roy	Mackintosh, John P.
Davidson, Arthur (Accrington)	Hazell, Bert	Maclennan, Robert
Davies, Harold (Leek)	Heffer, Eric S.	McMillan, Tom (Glasgow, C.)
Dell, Edmund	Henig, Stanley	McNamara, J. Kevin
Mallalieu, J. P. W. (Huddersfield, E.)	Parkyn, Brian (Bedford)	Urwin, T. W.
Manuel, Archie	Pavitt, Laurence	Wainwright, Edwin (Dearne Valley)
Mapp, Charles	Pentland, Norman	Walker, Harold (Doncaster)
Marquand, David	Perry, George H. (Nottingham, S.)	Watkins, David (Consett)
Mason, Roy	Rees, Merlyn	Watkins, Tudor (Brecon & Radnor)
Maxwell, Robert	Reynolds, G. W.	Wells, William (Walsall, N.)
Mendelson, J. J.	Roberts, Albert (Normanton)	White, Mrs. Eirene
Mikardo, Ian	Roberts, Gwilym (Bedfordshire, S.)	Whitlock, William
Millan, Bruce	Robinson, W. O. J. (Walth'stow, E.)	Willey, Rt. Hn. Frederick
Milne, Edward (Blyth)	Roebuck, Roy	Williams, Alan (Swansea, W.)
Morris, Charles R. (Openshaw)	Rose, Paul	Williams, Alan Lee (Hornchurch)
Morris, John (Aberavon)	Shaw, Arnold (Ilford, S.)	Williams, Mrs. Shirley (Hitchin)
Murray, Albert	Shore, Peter (Stepney)	Willis, George (Edinburgh, E.)
Newens, Stan	Silkin, Rt. Hn. John (Deptford)	Wilson, William (Coventry, S.)
Noel-Baker, Francis (Swindon)	Silverman, Julius (Aston)	Winterbottom, R. E.
Oakes, Gordon	Slater, Joseph	Woodburn, Rt. Hn. A.
Ogden, Eric	Stewart, Rt. Hn. Michael	Woof, Robert
O'Malley, Brian	Summerskill, Hn. Dr. Shirley
Orme, Stanley	Swingler, Stephen	TELLERS FOR THE AYES:
Owen, Dr. David (Plymouth, S'tn)	Taverne, Dick	Mr. Alan Fitch and
Page, Derek (King's Lynn)	Tinn, James	Mr. Neil McBride.
NOES
Allason, James (Hemel Hempstead)	Heald, Rt. Hn. Sir Lionel	Page, Graham (Crosby)
Astor, John	Heseltine, Michael	Page, John (Harrow, W.)
Atkins, Humphrey (M't'n & M'd'n)	Higgins, Terence L.	Pardoe, John
Baker, W. H. K.	Hiley, Joseph	Peel, John
Balniel, Lord	Hill, J. E. B.	Percival, Ian
Biffen, John	Hirst, Geoffrey	Pink, R. Bonner
Boyle, Rt. Hn, Sir Edward	Holland, Philip	Price, David (Eastleigh)
Brewis, John	Hordern, peter	Prior, J. M. L.
Bromley-Davenport, Lt.-Col. Sir Walter	Howell, David (Guildford)	Pym, Francis
Brown, Sir Edward (Bath)	Hunt, John	Ridley, Hn. Nicholas
Bruce-Gardyne, J.	Hutchison, Michael Clark	Royle, Anthony
Carr, Rt. Hn. Robert	Iremonger, T. L.	Russell, Sir Ronald
Chichester-Clark, R.	Jenkin, Patrick (Woodford)	Scott, Nicholas
Clegg, Walter	Johnson Smith, G. (E. Grinstead)	Sharples, Richard
Corfield, F. V.	Jopling, Michael	Shaw, Michael (Sc'b'gh & Whitby)
Dance, James	Kaberry, Sir Donald	Sinclair, Sir George
Dean, Paul (Somerset, N.)	Kershaw, Anthony	Smith, John
Deedes, Rt. Hn. W. F. (Ashford)	Kimball, Marcus	Stoddart-Scott, Col. Sir M. (Ripon)
Dodds-Parker, Douglas	King, Evelyn (Dorset, S.)	Taylor, Sir Charles (Eastbourne)
Eden, Sir John	Kirk, Peter	Taylor, Edward M. (G'gow, Cathcart)
Elliott, R. W. (N'c'tle-upon-Tyne, N.)	Kitson, Timothy	Taylor, Frank (Moss Side)
Emery, Peter	Knight, Mrs. Jill	Thatcher, Mrs. Margaret
Errington, Sir Eric	Lambton, Viscount	Turton, Rt. Hn. R. H.
Eyre, Reginald	Lewis, Kenneth (Rutland)	van Straubenzee, W. R.
Fisher, Nigel	Lubbock, Eric	Wainwright, Richard (Colne Valley)
Fletcher-Cooke, Charles	MacArthur, Ian	Walker, Peter (Worcester)
Fortescue, Tim	Macleod, Rt, Hn, Iain	Weatherill, Bernard
Gilmour, Sir John (Fife, E.)	Maude, Angus	Webster, David
Glover, Sir Douglas	Mawby, Ray	Wells, John (Maidstone)
Glyn, Sir Richard	Maxwell-Hyslop, R. J.	Whitelaw, Rt. Hn. William
Goodhew, Victor	Maydon, Lt.-Cmdr. S. L. C.	Wilson, Geoffrey (Truro)
Gower, Raymond	Mills, Peter (Torrington)	Winstanley, Dr. M. P.
Grant, Anthony	Miscampbell, Norman	Wolrige-Gordon, Patrick
Grant-Ferris, R.	Mitchell, David (Basingstoke)	Wright, Esmond
Griffiths, Eldon (Bury St. Edmunds)	Morrison, Charles (Devizes)	Wylie, N. R.
Gurden, Harold	Munro-Lucas-Tooth, Sir Hugh	Younger, Hn. George
Harris, Reader (Heston)	Murton, Oscar
Harvie Anderson, Miss	Noble, Rt. Hn. Michael	TELLERS FOR THE NOES:
Hawkins, Paul	Onslow, Cranley	Mr. Jasper More and
		Mr. Hector Monro.

Question put accordingly, That further consideration of the Bill, as amended, be now adjourned:—

The House divided: Ayes 115, Noes 164.

Division No. 437.]	AYES	[2.3 a.m.
Alison, Michael (Barkston Ash)	Bruce-Cardyne, J.	Emery, Peter
Allason, James (Hemel Hempstead)	Carr, Rt. Hn. Robert	Errington, Sir Eric
Astor, John	Chichester-Clark, R.	Eyre, Reginald
Atkins, Humphrey (M't'n & M'd'n)	Clegg, Walter	Fisher, Nigel
Baker, W. H. K.	Corfield, F. V.	Fletcher-Cooke, Charles
Balniel, Lord	Dance, James	Fortescue, Tim
Biffen, John	Dean, Paul (Somerset, N.)	Gilmour, Sir John (Fife, E.)
Boyle, Rt. Hn. Sir Edward	Deedes, Rt. Hn. W. F. (Ashford)	Glover, Sir Douglas
Brewis, John	Dodds-Parker, Douglas	Glyn, Sir Richard
Bromley-Davenport, Lt.-Col. Sir Walter	Eden, Sir John	Goodhew, Victor
Brown, Sir Edward (Bath)	Elliott, R. W. (N'c'tle-upon-Tyne, N.)	Gower, Raymond
Grant, Anthony	Lambton, Viscount	Russell, Sir Ronald
Grant-Ferris, R.	Lewis, Kenneth (Rutland)	Scott, Nicholas
Griffiths, Eldon (Bury St. Edmunds)	Lubbock, Eric	Sharples, Richard
Gurden, Harold	MacArthur, Ian	Shaw, Michael (Sc'b'gh & Whitby)
Harris, Reader (Heston)	Macleod, Rt. Hn. Iain	Sinclair, Sir George
Harvie Anderson, Miss	Maude, Angus	Smith, John
Hawkins, Paul	Mawby, Ray	Stoddart-Scott, Col. Sir M. (Ripon)
Heald, Rt. Hn. Sir Lionel	Maxwell-Hyslop, R. J.	Taylor, Sir Charles (Eastbourne)
Heseltine, Michael	Maydon, Lt.-Cmdr. S. L. C.	Taylor, Edward M. (G'gow, Cathcart)
Higgins, Terence L.	Mills, Peter (Torrington)	Taylor, Frank (Moss Side)
Hiley, Joseph	Miscampbell, Norman	Thatcher, Mrs. Margaret
Hill, J. E. B.	Mitchell, David (Basingstoke)	Turton, Rt. Hn. R. H.
Hirst, Geoffrey	Monro, Hector	van Straubenzee, W. R.
Holland, Philip	More, Jasper	Wainwright, Richard (Colne Valley)
Hordern, Peter	Morrison, Charles (Devizes)	Walker, Peter (Worcester)
Howell, David (Guildford)	Munro-Lucas-Tooth, Sir Hugh	Webster, David
Hunt, John	Murton, Oscar	Wells, John (Maidstone)
Hutchison, Michael Clark	Noble, Rt. Hn. Michael	Whitelaw, Rt. Hn. William
Iremonger, T. L.	Onslow, Cranley	Wilson, Geoffrey (Truro)
Jenkin, Patrick (Woodford)	Page, Graham (Crosby)	Winstanley, Dr. M. P.
Johnson Smith, G. (E. Grinstead)	Page, John (Harrow, W.)	Wolrige-Cordon, Patrick
Jopling, Michael	Pardoe, John	Wright, Esmond
Kaberry, Sir Donald	peel, John	Wylie, N. R.
Kershaw, Anthony	Percival, Ian	Younger, Hn. George
Kimball, Marcus	Pink, R. Bonner
King, Evelyn (Dorset, S.)	Price, David (Eastleigh)	TELLERS FOR THE AYES:
Kirk, Peter	Prior, J. M. L.	Mr. Bernard Weatherill and
Kitson, Timothy	Pym, Francis	Mr. Anthony Royle.
Knight, Mrs. Jill	Ridley, Hn. Nicholas
NOES
Alldritt, Walter	Forrester, John	McNamara, J. Kevin
Armstrong, Ernest	Fowler, Gerry	Mallalieu, J. P. W. (Huddersfield, E.)
Ashley, Jack	Fraser, John (Norwood)	Manuel, Archie
Atkins, Ronald (Preston, N.)	Freeson, Reginald	Mapp, Charles
Atkinson, Norman (Tottenham)	Gardner, Tony	Marquand, David
Bacon, Rt. Hn. Alice	Garrett, W. E.	Mason, Roy
Bagier, Gordon A. T.	Gray, Dr. Hugh (Yarmouth)	Maxwell, Robert
Barnes, Michael	Gregory, Arnold	Mendelson, J. J.
Baxter, William	Grey, Charles (Durham)	Mikardo, Ian
Bence, Cyril	Hamilton, James (Bothwell)	Millan, Bruce
Benn, Rt. Hn. Anthony Wedgwood	Hannan, William	Milne, Edward (Blyth)
Bidwell, Sydney	Harper, Joseph	Morris, Charles R. (Openshaw)
Binns, John	Harrison, Walter (Wakefield)	Morris, John (Aberavon)
Bishop, E. S.	Hart, Mrs. Judith	Murray, Albert
Blackburn, F.	Haseldine, Norman	Newens, Stan
Bradley, Tom	Hattersley, Roy	Noel-Baker, Francis (Swindon)
Bray, Dr. Jeremy	Hazell, Bert	Oakes, Gordon
Brooks, Edwin	Heffer, Eric S.	Ogden, Eric
Brown, Rt. Hn. George (Belper)	Henig, Stanley	O'Malley, Brian
Brown, Hugh D. (G'gow, Provan)	Herbison, Rt. Hn. Margaret	Orme, Stanley
Brown, Bob(N'c'tle-upon-Tyne, W)	Hooley, Frank	Owen, Dr. David (Plymouth, S'tn)
Brown, R. W. (Shoreditch & F'bury)	Howarth, Robert (Bolton, E.)	Page, Derek (King's Lynn)
Buchan, Norman	Howell, Denis (Small Heath)	Parkyn, Brian (Bedford)
Buchanan, Richard (G'gow, Sp'burn)	Howie, W.	Pavitt, Laurence
Callaghan, Rt. Hn. James	Hoy, James	Pentland, Norman
Carmichael, Neil	Huckfield, L.	Perry, George H. (Nottingham, S.)
Coe, Denis	Hunter, Adam	Rees, Merlyn
Coleman, Donald	Hynd, John	Reynolds, G. W.
Conlan, Bernard	Jackson, Colin (B'h'se & Spenb'gh)	Roberts, Albert (Normanton)
Crawshaw, Richard	Jeger, Mrs. Lena (H'b'n & St. P'cras, S.)	Roberts, Gwilym (Bedfordshire, S.)
Crosland, Rt. Hn. Anthony	Jenkins, Hugh (Putney)	Robinson, W. O. J. (Walth'stow, E.)
Crossman, Rt. Hn. Richard	Johnson, James (K'ston-on-Hull, W.)	Roebuck, Roy
Dalyell, Tam	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Rose, Paul
Davidson, Arthur (Accrington)	Jones, T. Alec (Rhondda, West)	Shaw, Arnold (Ilford, S.)
Davies, Harold (Leek)	Judd, Frank	Shore, Peter (Stepney)
Dell, Edmund	Kerr, Russell (Feltham)	Silkin, Rt. Hn. John (Deptford)
Dempsey, James	Leadbitter, Ted	Silverman, Julius (Aston)
Dewar, Donald	Ledger, Ron	Slater, Joseph
Diamond, Rt. Hn. John	Lee, Rt. Hn. Frederick (Newton)	Stewart, Rt. Hn. Michael
Doig, Peter	Lee, John (Reading)	Summerskill, Hn. Dr. Shirley
Dunn, James A.	Lewis, Ron (Carlisle)	Swingler, Stephen
Dunwoody, Mrs. Gwyneth (Exeter)	Lomas, Kenneth	Taverne, Dick
Dunwoody, Dr. John (F'th & C'b'e)	Loughlin, Charles	Tinn, James
Eadie, Alex	Lyon, Alexander W. (York)	Urwin, T. W.
Edwards, Robert (Bilston)	Lyons, Edward (Bradford, E.)	Wainwright, Edwin (Dearne Valley)
Ellis, John	MacColl, James	Walker, Harold (Doncaster)
English, Michael	MacDermot, Niall	Watkins, David (Consett)
Ennals, David	Mackenzie, Gregor (Rutherglen)	Watkins, Tudor (Brecon & Radnor)
Ensor, David	Mackie, John	Wells, William (Walsall, N.)
Evans, Ioan L. (Birm'h'm, Yardley)	Mackintosh, John P.	White, Mrs. Eirene
Fernyhough, E.	Maclennan, Robert	Whitlock, William
Foot, Michael (Ebbw Vale)	McMillan, Tom (Glasgow, C.)	Willey, Rt. Hn. Frederick

Williams, Alan (Swansea, W.)	Wilson, William (Coventry, s.)	TELLERS FOR THE NOES:
Williams, Alan Lee (Hornchurch)	Winterbottom, R. E.	Mr. Alan Fitch and
Williams, Mrs. Shirley (Hitchin)	Woodburn, Rt. Hn. A.	Mr. Neil McBride.
Willis, George (Edinburgh, E.)	Woof, Robert

Mr. Orme

I beg to move Amendment No. 13, in page 2, line 9, at the end to insert: (3) Subsections (1) and (2) of this section shall not apply to any award or settlement which forms part of a productivity bargain.

Mr. Deputy Speaker (Sir Eric Fletcher)

I think that it will be for the convenience of the House if with that Amendment we discuss Amendment No. 24, in Clause 3, page 3, line 19, at the end to insert: 'and (c) it appears to the Secretary of State that there has been no increase in productivity', Amendment No. 38, in Clause 6, page 8, line 1, after 'Prices' to insert 'Productivity', Amendment No. 39, in page 8, line 3, after 'Prices', to insert 'Productivity' and Amendment No. 44, in the Schedule, page 8, line 14, after 'respect', to insert: 'which is part of a productivity bargain or'.

Sir D. Glover

On a point of Order. Mr. Deputy Speaker, does that mean that we can have only one Division, or will we he able to divide on the others?

Mr. Deputy Speaker

Only one Division, will be permitted, on Amendment No. 13.

Mr. Orme

We attach a great deal of importance to this issue of productivity, and to productivity agreements. In my brief contribution to this debate I propose to draw attention to the fact that ore is hard put to find the word "productivity" in the Bill. I think that this in itself is lamentable, especially when one remembers that we set off on this road with this statement produced by the then First Secretary of State, now the Foreign Secretary, entitled "Joint Statement of Intent on Productivity, Prices and Incomes".

My hon. Friends and I want to know what has happened to the consideration of productivity. It appears to us that the emphasis has moved away from productivity and prices, but has remained on incomes. This is our basic complaint about the Government's approach to this subject. My right hon. Friend made a long statement in reply to the previous debate, but it was only when he was about to resume his seat that he referred to the productivity, prices and incomes policy. That was the first time that I had heard it mentioned throughout the debate. I do not know what happened in Committee, but we have not heard productivity referred to here, and therefore my hon. Friends and I want to exclude from these agreements the issue of productivity.

2.15 a.m.

We have had some illuminating experiences of the productivity issue during the operation of Part IV of the Act. Some interesting things have happened in the last 12 months. The Fawley petrol agreement two or three years ago was heralded as outstanding and has borne fruit since in the shape of the famous agreements at Esso, Fairfields Shipyard and British Oxygen, but that agreement would not have been accepable under the Prices and Incomes Act and the other three were not acceptable until the Government realised the fantastic difficulties of reversing them.

Those agreements, affecting many workers, went through the net, but Government Orders under Part IV refuted much smaller ones, like that concerning the Birmingham drivers. Where do the Government stand on productivity, to which we attach the greatest importance? If we are to achieve economic growth, we must give incentives linked to productivity and the return for increased effort. It is facile to imagine that it will happen otherwise.

The Government's policy is restrictive and does not lead to growth of wages—this is the major criticism in the country—but to a wages freeze. We all know that the increased productivity which everyone wants can be achieved in British industry. The 4 per cent. growth rate which seems so unattainable is within our reach but can be achieved only through incentives and by giving the unions the right to conclude agreements with employers. To think of shuffling on to Aubrey Jones the day-to-day negotiations and discussions of industry, in the mine, the dockyard and the building site is to live in cloud-cuckoo-land.

Who will negotiate? Will the unions make concessions in return for receiving them, knowing that, if they complete these agreements instead of their being automatically enforced, they will have to wait a long time while they are investigated by the Board? They are, no doubt. a splendid body of gentlemen, but I do not think they know enough about British industry to deal with productivity agreements.

The Government have got the detailed day-to-day knowledge of these matters. My hon. Friends and I regard this as a very important Amendment and we want to know what are the intentions of the Government. Where do they stand in relation to productivity agreements? How will these be affected by the Bill? It will not be good enough to shunt these things off into the sidings. Throughout industry there is a great deal of cynicism about the whole issue of prices and incomes, particularly with an economy which is running with slack in it, in a period when we have stagnation and unemployment.

We hear a good deal of talk about getting rid of restrictive practices. I noticed that the Leader of the Opposition returned to this subject during the weekend. But that is not the priority. Confidence is needed in industry. Full employment is needed. People want the right to organise, and organised workers require to go ahead with their productivity agreements. I have never held out much hope for wages councils and such bodies for the lower-paid workers. Many of these workers who are in unorganised industries would be better off if they became organised in proper trade unions. I see this as the logical step to be taken by trade unionists. It is interesting to note that some of our highest-paid workers are among the highest organised in the country. This is a very important fact which should not be overlooked.

My hon. Friends and I feel that much of the difficulty which has been encountered-tonight could have been overcome if the Government had had the foresight to appreciate that if one cannot express democratic points of view in Committee one must do it in the House of Commons. I say this in all sincerity to my right hon. and hon. Friends on the Front Bench. We submit this as a serious Amendment which we believe should be incorporated in the Bill, for we believe that productivity agreements should be outside the terms of this Bill.

Mr. R. Carr

I suppose that the hon. Member for Salford, West (Mr. Orme) and hon. Members on this side of the House have pretty fundamental differences about a good many things in politics. But it is a treat to hear an hon. Member talking about this subject from the benches opposite for a change with the touch of practical experience in industry and what goes on on the factory floor. Many of us, not only in the House but outside, feel that a little more of this from the Government would make a great deal of difference to the way our industrial affairs are going.

We too attach much importance to productivity. The hon. Gentleman said that it would be hard to find mention of it in the Bill. In fact, it is impossible; the word is not mentioned between one cover and the other. We believe that it should be included, and we therefore support the Amendments put down by hon. Gentlemen opposite on this subject, and we have put down one of the group of Amendments which we are also now discussing.

As the hon. Gentleman said, the policy with which we are concerned started as the policy for productivity, prices and incomes. However much we on this side of the House may have disagreed with the methods and agencies proposed by the Government, at least the tripartite policy of productivity, prices and incomes made sense as a concept, whatever differences people might feel about the way of pursuing it.

But we agree that productivity seems to have got lost in the wash. It is about time it was found again. There is unanimity not only in the House but in the country as a whole that we are seeking a way of obtaining a balance in the equation between increases in earnings and increases in productivity. That balance can be obtained in more than one way. It can be obtained by repressing earnings, by encouraging productivity, or by a little of each.

We are in no doubt that in the way in which the Government's policy has developed, particularly over the past year and as it is proposed for the next year, far too much emphasis is being put on the repression of earnings. The country will never solve its problems in that way.

It is high time the balance was redressed. We cannot discuss all the measures required to increase productivity, because most of them, and probably the main ones, lie outside the scope of this or any other Prices and Incomes Bill. The Bill, however amended, could not be one of the chief weapons for this purpose.

Nevertheless, it is most important that it should at least not discourage the search for increased productivity and that if possible it should contain measures which will promote it. It would be a great mistake if the Bill left here with no overt recognition of the need to encourage productivity. Therefore, I hope that the Government will agree to the Amendments, or that if they do not like them they will produce similar Amendments of their own. The Bill must not leave here without the word "productivity" in it, in a significant way.

I doubt whether the Government appreciate the damage which has been done and is being done to the cause of higher productivity by the way their prices and incomes policies have been pursued. Therefore, I doubt whether they are yet fully aware of the urgent need to correct that damage.

We urgently want more agreements like that at Fawley. It may not be perfect in every way, but I do not think that anybody with experience of industry could have any doubt that it was a break-through. I know that that word can be over-done, but I believe that it was a break-through which should be emulated and in no way held back in other parts of industry. But it is extremely doubtful whether the Fawley agreement would have got through under the Government's policies without a long drawn reference to the Prices and Incomes Board. The House must consider what that means. If we are to get pro- ductivity agreements, it is very important that the people at plant level should know that they can do business with each other and should feel free to put the results of it into practice without the gentleman in Whitehall thinking that he knows better and causing long delay.

2.30 a.m.

I should not be in order in going into the question of the Birmingham car delivery workers, but, from what I know of it, that is a much more doubtful example of a productivity agreement than the Fawley agreement. The dreadful thing is that under the Government's policy, even after all this time, there is still uncertainty as to what the status of the agreement is and about whether some of the workers, if the law is to be enforced, should be prosecuted. This is not the way in which we shall get a balance in the equation between prices and increases in productivity and increases in incomes.

I return to a point which I touched on earlier. If we are to get increases in productivity, which we must have, there must be flexibility in methods of work and in wage structures and differentials. There must be the acceptance of change and confidence that the change will be to the good and that all aspects of an agreement will be honoured in full. There must, therefore, be confidence, particularly at plant level, that managers and trade unions can do business together. I do not think that the Government yet realise the damage which has been done in the last year by forcing employers to break their contracts and the damage which will be done in the next year by creating the feeling that employers and trade unions cannot come to an agreement without one side or the other being prevented from honouring it, or, if they honour it, being forced to break it.

I know of examples in which this damage has been done. I know of hard work which has been done to overcome the historical suspicions of trade unions in relation to certain practices and in which success was at least achieved in getting certain practices given up. I know of a case in which certain practices were given up in return for a promise that certain increases would be made last autumn and the employers were prevented from making good their promise. How will employers get back on a satisfactory level with trade unions in view of that sort of thing?

This way of going on has created damage and will continue to create damage. The least that the Government can do is to make sure that we show by the words in the Bill our wholehearted support for the fact that productivity, and only productivity, will be the cure for our problems. For those reasons, my right hon. and hon. Friends will support the Amendments.

Mr. Mikardo

The right hon. Member for Mitcham (Mr. R. Carr) said—and I agree with him—that a great deal of damage was caused because a number of employers were, against their will, compelled to dishonour agreements into which they had freely entered and which, I am sure, they wanted to honour. I know of a number of companies in which industrial relations were pretty good which have had a shaking because of the compulsion put on employers. Many employers were not compelled to dishonour agreements, but they rushed to dishonour them all the same. Others anticipated the legislation and broke agreements which they were not compelled to break. They were delighted to break them, and a great deal of damage was done in those cases.

In debating an earlier Amendment my hon. Friend the Member for Ebbw Vale (Mr. Michael Foot) pointed out that my hon. Friends who had tabled Amendments, which we did not have an opportunity of tabling in Committee, were not opposed to a policy for productivity, prices and incomes but were tabling Amendments because the Government's policy in this matter had got out of focus and balance. Nothing could demonstrate this more clearly than the complete absence from the Bill of any mention of productivity.

We are supposed to be having a Government policy for productivity, prices and incomes, with equal weight attached to each. In respect of incomes we have Government controls, plus punitive sanctions. In respect of prices we have Government controls but no punitive sanctions. And in respect of productivity we have absolutely nothing whatever. How on earth can anybody say that this is a balanced policy for productivity, prices and incomes?

If the Parliamentary Secretary asks the House to reject this series of Amendments and does not suggest putting something in its place, I do not envy him the next time he goes to a trade union conference and tries to explain that the Government's policy is designed to stimulate productivity. How will he even be able to keep a straight face when he knows that the word "productivity" does not even appear in the title of the Bill, let alone in its provisions? If my hon. Friend rejects these proposals and does not put anything in their place, he will be making life impossible for his hon. Friends who have entered a large programme of addressing policy conferences throughout the country, at which large numbers of trade unionists are present.

Having listened to so many of the Parliamentary Secretary's speeches, I know what he is likely to reply to these arguments. I have entered into his mind; and I am sure he has entered into mine. I could make his speech for him. There is only one difference between us, and that is that I know what his legislations means while he does not. I recall that when we were debating the No. 1 Measure some of us told him that it did not say what he thought it said. The trade union of which I am a member—and of which he is a distinguished ornament—told him that the Measure meant what we thought it meant, and he said we were wrong; but the High Court said that we were right and he was wrong. Sometimes my hon. Friend has been a little rough with the House when replying to debates on Orders made under the No. 1 Measure. I hope, since we knew more about the first piece of legislation on this subject than he knew, that he will now speak with a little humility.

I know what my hon. Friend will tell us. He will say that these Amendments are unnecessary because, when references are made to the National Board for Prices and Incomes, one of the things the Board will take into account is whether it is part of a productivity bargain; that, if it is, the Board will O.K. it, and there is therefore no need for the provision. That may be all right in theory but not in practice, for two very good reasons that I shall try to explain.

The first reason is that the effect of not having this provision in the Bill and of saying that workers can get increased wages as part of a productivity bargain which the Board looks at and then says it is all right, if it is, will be that many productivity bargains that would otherwise have been negotiated will not be negotiated. I do not think that members of the Government who have never done ally wage bargaining appreciate that working out a productivity bargain is not the sort of thing that can be done in five minutes. In nearly every industry it is a long-drawn-out operation, and in some industries it is a most difficult and intricate operation.

No one on either the management side or the trade union side will embark on what is often several months of research into the job— not just bargaining across the table, but having a joint study of the job by a study group composed of the two sides and doing several months of research—if, at the end of it all, they do not know whether or not the agreement, if reached, resulting from their joint research will be validated. In that case they will be very hesitant to do that work. It is therefore not true to say that good productivity agreements will get by under this Measure. A lot of good productivity agreements will be stillborn; they will never be worked out in order to go to the Prices and Incomes Board.

I can give my hon. Friend an illustration at the present time from a nationalised industry. One of the reasons why the British Overseas Airways Corporation is at the moment in a pretty big upswing is that two or three years ago it was able to nip in before this prices and incomes policy came about and negotiate an agreement which revolutionised its maintenance methods under what is known as the "dual function" system; a system under which those who supervise the maintenance work may also inspect it and certificate it. This meant a great upsurge in productivity, as the Corporation was very quick to recognise. It has been one of the major contributors to the Corporation's excellent operational and financial results of the last two or three years.

The same is not true of the British European Airways, which is doing not nearly as well as B.O.A.C. because it was not quite so quick. It attempted to emulate the same revolution that has been carried out by B.O.A.C. but it has been caught in the Prices and Incomes Act. British European Airways had actually worked out the same sort of system as B.O.A.C.—mutatis mutandis, because there are differences between long-haul and short-haul airlines, but it was ready to get down to detailed negotiations.

But it is now known that, whatever the result of the detailed negotiations, the Corporation and the trade unions may propose but Mr. Aubrey Jones will dispose, and the trade unions are not prepared to have Mr. Aubrey Jones in this case dispose of their welfare, so the negotiation is not going forward. It is no use my hon Friend saying, if he was intending to say, that B.E.A. can do just as well as B.O.A.C.; that all it has to do is to reach an agreement and put it up. It will not be put up. I can tell him so with absolute authority, because I am one of the chaps who is supposed to be working it out, and I shall not waste time working it out. So it just is not going to be put up. That is straight from the horses's mouth.

There is another reason why it would be purely theoretical to say that this Amendment is unnecessary because we can leave the P.I.B. to work out the matter. The Prices and Incomes Board does not personally investigate these matters. It could not. The members of the Board do not have nearly enough man hours available for the purpose, even if they had the expertise, and, with respect, I do not think that many of them have any expertise. Even if they did, they could not investigate all these matters. So they rely on people brought in from outside, consultants of various sorts and others. They may be very good people, but we do not know whether they are, because they are very anonymous people. That is their greatest characteristic.

2.45 a.m.

When a trade union and an employer put up to the Board a productivity bargain which they have reached, they do not know whom they are putting it up to. They are people who know the industry. It is a great sweat to get the agreement, and they will not do it if it goes up to some anonymous, faceless man who does the job, however much it is rubber-stamped afterwards by one of the Board nominally acting as chairman of the investigating committee. They will not go through it all if it is to be put up to a faceless consultant.

There is an increasing tendency to use American firms of consultants on this sort of thing. Although, no doubt, they are technically competent, many of them do not yet have the feel for British industry. They will get it when they have been here another 30 years. Some of them, however, come by aircraft from New York and they do not have the fee] of industrial relations in Britain. Certainly, the trade unions and a great many managements do not have confidence in them to understand the sort of things that are talked about in a negotiated productivity agreement.

For those reasons, I say to my hon. Friend the Joint Parliamentary Secretary that the speech which he makes, and which I have made for him in advance, to the effect there is no need for all this because the Board will see it, is not a very good speech. I hope that by the time he gets up to speak, he can think out a better one.

Mr, Alison

The hon. Member for Salford, West (Mr. Orme), to whom I listened with great enjoyment, has done the House a service by trying to get the missing word "productivity" into the Bill. As everybody has pointed out, it was conspicuous by its absence until he introduced his Amendment.

The hon. Member has, however, not gone far enough in his analysis of where some of the rewards for increases in productivity should go. He laid great stress on the reward to labour, but there is another aspect of it. This is where the whole productivity outlook and analysis by the Government is hoplelessly awry and completely contradictory. They do not even know what one part of the Government body is saying.

I remind the Joint Parliamentary Secretary of what that extraordinary document called "Progress Report", issued by the Department of Economic Affairs—one of the great misnomers of the Socialist Government—said recently about productivity. The latest one to be issued said: The broad determinants of productivity growth are, however, the increase in capital and improvements in technique and organisation. It goes on to say: The effects of these are difficult or impossible to measure directly"— that may be one reason why the Government have not introduced the concept of productivity into the Bill— though work on this problem is going on in the Government, universities and other institutions. There is no doubt, however, that there is great scope for raising the growth of productivity". One thing which is conspicuously true also is that there is no scope here for increasing the rewards for an increase in productivity. It says: There is no doubt, however, that there is great scope for raising the growth of productivity through the application of improvements in technology and organisation, and this is a subject that has been increasingly occupying the attention of Government and industry. This is a point of some importance, because the Government explicitly talk about the increase in capital and improvements in technique and organisation"— that is, capital and management—as being the broad determinants of productivity growth". There is very little mention of these.

There was one lacuna in the speech of the hon. Member for Salford, West. He talked a lot about the reward which should properly be applicable to labour in productivity increases. What about the return to capital and the return to management? This point needs developing, because too much attention in many ways is paid to the labour aspect of increases in productivity. I want to quote some very penetrating words by that very well known American management consultant, Mr. Peter Drucker, who points out that the balance between all factors of production is what is crucial in productivity increases and is only distantly related to output per worker. He says that the concept of productivity increase related to output per worker is based on the mechanistic fallacy that all human achievement could eventually be measured in units of muscle effort. But productivity, he says, in modern economies, is always achieved by doing away with muscle effort and substituting something else for the labourer—that is, capital equipment and, before capital, even, conceptual, theoretical, analytical effort, that is, management.

This is not in any way to denounce the rôle of labour in productivity. Part of the difficulty is that many of the rank and file jobs in industry are managerial. The key in increasing productivity is in recognising that it is essentially a function of capital and, even before capital, the function of analytical and conceptual ideas of management and organising capital. We see clearly how companies with parallel and similar levels of capital intensity can achieve different returns on capital investment, simply because of better management in one place than in another. This is what occurs in the United States.

There is not a glimmer of understanding of this in any of the Government's proposals for increases in productivity. There is no conception at all that management and capital need a return. The Government have gone flat out to try to depress the return, not only on capital but for management, in the determination to try to keep prices down whilst allowing some costs to rise and decreasing the incentive for private business to invest. The Government must recognise this and take action. Do they believe that there should be a positive encouragement for a greater return on capital in increases in productivity? This is apparently ignored by the Government in the whole o their concept of the prices, productivity and incomes policy.

Another point arises from the elimination of the norm. In paragraph 20 of Cmnd. 3235, which is now to be a Schedule to the 1966 Act, the Government baldly state: There can be no justification at present for returning to the norm of 3–3½ per cent. per annum which prevailed up to July, 1966, and which in practice tended to be regarded as the minimum increase which everyone expected to receive. The Government have deliberately abandoned the norm. Again, this is a crazy and completely contradictory thing to have done in the circumstances, because the whole purpose of the norm, as the Government have repeatedly said in various of their publications, was to match increases in wages and earnings with the long-term trend of productivity. Something must be substituted for the abandoned norm.

What I suspect will be substituted for it is not the long-term increase in productivity, running at somewhere between 3 per cent. and 3½ per cent., which is the reason for originally fixing the norm at 3 per cent. to 3½ per cent. What will happen is that the measure of a legitimate increase in earnings or wages will be that which measures against the short-term increase in productivity. There is a great difference between the long-term and short-term increase in productivity. On the upswing of an economy's development, when there is a lot of slack, and the tendency is to try to get output increased as rapidly and as effectively as possible, there are quite sensational short-term increases in productivity.

Although the long-term trends in productivity increases in the rate of growth in the economy have been between 3 per cent. and 3½ per cent.—and this was the reason for the original norm—to take for example 1964, there was a growth in productivity in that year of 4½ per cent., but it was an upswing year, and the economy was booming and things were expanding. This is 50 per cent. higher than the longer-term trend. That means that if the Government are explicitly abandoning the norm and writing nothing into the Act to replace it, they will be governed, in respect of claims for increases based on increases in productivity, by the only available guide in a particular year for which application is made, the short-term increase in productivity.

When the 1967–68 upswing comes, if it does, there will be a surge in productivity, while we rise in degrees of economic activity to the level of full productive potential, before productivity begins to undergo the long-term reversion to the norm. In the short term there might be a 4½ per cent. to 5 per cent. increase in productivity. By deliberately eliminating a guiding norm, the Government must now concede that in a year of upswing the productivity increase upon which earnings or increased wages can be judged, and applied for, must relate to that short-term increase.

The Government will find themselves in a much worse situation than before. At precisely the moment that they want to control prices, when the economy is in a boom, and profit resource is increasing, then it will be that the Government's present proposals will enable a very much higher application for wage increases to be made than would be admissible under the old concept of the long-term trend.

The Government do not have a clue about productivity. They have not taken any notice of the theory of this, of the analyses which their Departments are working on. All that they are concerned with is to keep things down, to batten down the hatches. The effect of this will be precisely what we fear—private investors will not invest, and there will not be the attempt to increase the productivity of the economy by the only rational means, which is to increase capital intensity and improve matters. The Government do not know what they are doing and this was made abundantly clear by the speech of the hon. Member for Salford, West. We certainly welcome this attempt to get the idea of productivity into the Bill.

Sir John Eden (Bournemouth, West)

I congratulate my hon. Friend the Member for Barkston Ash (Mr. Alison) on his fluency, and upon making such an interesting contribution to this important debate. He drew out some of the major elements of the argument, and I will add one or two observations. So often when management is considering the installation of new capital equipment to try to improve methods of production and increase the number of units produced, thereby reducing the unit cost of what is being made, the opportunity is taken to introduce new scales of remuneration. It is also in order to try to ensure that the costly new capital equipment is utilised to the fullest possible extent, so that the customs which have been growing up over past years which are no longer relevant to the present time are prevented from being carried forward into the new era in the future.

3.0 a.m.

This is why I think this Amendment is so important, because after all that is what productivity is all about. Pro- ductivity is not just matter of—[Interruption.]

Mr. Deputy Speaker

Order.

Sir J. Eden

It is quite all right, Mr. Deputy Speaker. I think there is an important conference going on over there. We shall no doubt hear about it in due course as the hon. Member for Ebbw Vale (Mr. Michael Foot) has been extremely active and doubtless will be rising to his feet to explain to the House what is the purport of the consultations taking place behind him. I notice that this has succeeded in evicting the hon. Member for Poplar (Mr. Mikardo). What a pity the hon. Gentleman is not here to listen to the rest of the debate, because he made a very significant contribution himself.

The point I was making was that the whole purpose of introducing new plant and capital equipment into a factory is to improve the methods of production and to lower the unit cost. When this is done it leads almost invariably to the introduction of new rates of pay; new manning agreements are introduced, and since the introduction of new capital equipment almost invariably leads to a reduction in the labour force engaged on that particular section of the factory, the plant or the manufacture, then with the reduced labour force the opportunity is given for higher rates of pay to be introduced.

I should have thought that this is what we are all about, and I take a less pessimistic view than the hon. Member for Salford, West (Mr. Orme) about the attitude of the Government here. I should have thought that they would accept, if not the exact wording of this Amendment, something very similar to it. I would expect they would rush to introduce an Amendment comparable to this for themselves because I am certain they will wish to have included in the Bill more than just a passing reference to productivity. I should have thought they would want the whole thing spelt out in detail.

Like the hon. Member, and others of my hon. Friends who have spoken, I was always under the impression that the whole purpose of phase 2 of this massive operation of prices and incomes restriction was in order to get greater productivity. That was the whole object of the exercise. If it is not, I do not know what is. If it is just to restrict wages or halt prices then it is a very sterile operation. Surely the whole purpose was to get Britain moving again. If they are to do that we must have increased productivity, and if we are to have increased productivity we must have better utilisation of capital and of manpower. If we ate to get getter utilisation of manpower, we will not get it by freezing wages but by offering better reward, by seeing that there is better opportunity, by seeing that there are prospects of much more substantial earnings arising out of more sensible manning of the latest installation of capital equipment. This is, at any rate, my concept of a prices and incomes policy, and I would be wholeheartedly in favour of it if it was geared to the positive objective I have touched upon, rather than always being bogged down in this wholly negative approach which the Government seem to be adopting.

I can also echo very strongly what the hon. Member for Salford, West and my hon. Friend also mentioned, the need to have a restoration of confidence throughout industry at every level. There is no doubt that confidence has been sadly shattered in the past few months. The Government could assist a great deal towards its restoration if they gave a clear indication, which they new have an opportunity of doing, that the emphasis in future will be on increased productivity rather than the reverse.

I hope that from now on we shall see the possibility at an increasingly rapid pace of having direct negotiations at plant level for proper manning agreements which will bring the prospect of increasing rewards to the men engaged in these activities. I agree with what my hon. Friend the Member for Barkston Ash said about the importance of ensuring that these productivity agreements and the increased remuneration which should go with them and be part and parcel of them should operate and have effect at all levels of the industrial scale from management to the shop floor. For what else do men work except for greater reward? If the Government cannot offer them that there is no prospect for the future of this country.

Mr. Emery

It seems to me that in this debate an increase in productivity is the most major essential for British industry in future. This is not something new for me to say; it has been said time and time again by Ministers on the Government Front Bench throughout the country over the last 2½ years. How can they expect either the trade unions or management in industry to have any respect for those speeches if when they have a possibility of showing the good faith of their words in action they do not put anything into the Bill about productivity?

At the start the whole basis and first principle of this business was a policy of productivity, prices and incomes. Yet we have now got so far along the road that productivity is absolutely forgotten. It is a terrifying condemnation of the action of the Government in their handling of the policy which is part of the corner-stone of their economic policy. What worries me even more is that the Government are asking industry to give more and more publicity to this in its reports and discussions within factories, and yet here again they will not take the lead by trying to do anything themselves.

I turn to two of the Amendments that we are discussing. Amendment No. 13 states that the section: shall not apply to any award or settlement which forms part of a productivity bargain. Amendment No. 24 which would provide power of definition in the words: it appears to the Secretary of State that there has been no increase in productivity. The difference between the two is that Amendment No. 24 would allow the right hon. Gentleman to define what was an increase in productivity. This is an important nuance.

I do not disagree with the general principles laid down in the admirable speech of the hon. Member for Salford, West (Mr. Orme). He understands the problems which have arisen but I believe that they are less real than worried about in relation to the interpretation of what is or is not a productivity bargain. I hope to have the support of hon. Members opposite in urging the Government that, even if they cannot accept Amendment No. 13, they should turn their attention to Amendment No. 24, which would give them specific extra power to interpret what is or is not a productivity agreement. This might well get over a large number of the worries the Government might propound for not accepting Amendment No. 13. They might claim, "So many things have been called 'productivity bargains' which never have been". But Amendment No. 24 would allow the Government to interpret what was or was not a productivity bargain. Perhaps it would be too wide a power but I would be willing for the Government to have it in order that we might get somewhere in productivity.

The hon. Member referred to cynicism and certain aspects of it among trade unionists. There is also considerable cynicism in managements, who have been encouraged to bring these bargains to a head. As the hon. Member for Poplar (Mr. Mikardo) said, if managements see there is no chance of these bargains being considered, they ask, "What are the Government up to? What do they want us to do?"

There is cynicism among the most progressive managements, on whom much of the productivity of the future will rest. If the Government give no encouragement to these people, their policy will be doomed to even greater failure. The hon. Member for Salford, West spoke of the need for full employment and there is also need for full capacitiy because it is by the use of full capacity that we shall get an increase in productivity. Is it by using the national assets to the full that the greatest benefit can be achieved. If full capacity is not used there is no chance of getting the increased drive for productivity which we all want to encourage.

One of my hon. Friends said that the Bill must not go through without a mention of productivity. I agree, but it is not only a matter of changing the title of the Bill, as a later Amendment suggests, but of changing its contents, and without such a change the Bill is nonsense. It will only be a cloak for the Government's actions.

3.15 a.m.

The trouble is that productivity is wanted not only for the benefit of management and worker. One section of the community never mentioned in debates on productivity is the ordinary consumer. The only time that the ordinary consumer—the housewife or the individual, the buyer in industry or the buyer in the shops—can receive a basic benefit is if productivity goes up sufficiently for both unions and management to benefit, and the consumer may then have a third of the increase reflected in a decrease in price, or an increase in quality.

Too often the ordinary consumer is forgotten in a debate of this sort. The trade unions are represented on one side of the House and management is talked about on the other. Let us have some realisation that the consumer has as important an interest in increased productivity as anybody else.

The hon. Member for Poplar said that firms needlessly rushed to break agreements when the initial legislation came in. If that can be substantiated, as I am sure it can, I would no more agree with it than he would, because it would be quite wrong.

The Board's Report No. 36, Productivity Agreements, deals with the very subject matter of this debate. Are productivity agreements right? Are they beneficial? Do they do what they set out to do? In paragraph 138 the Board says: We have reached the conclusion that, within the framework of a prices and incomes policy, productivity agreements are to be encouraged. Do not the Government want that? Do they believe that these things will happen without any active encouragement?

In "Guide-lines for the Future", page 40, paragaph 179, the Board says: We indicated earlier that in the light of our investigations there is a strong case for encouraging the spread of productivity agreements which conform with the requirements of a prices and incomes policy. We attach great importance"— I emphasise "great importance"— to this relationship between the two. … Why will not the Government realise this? Why will not the Government admit this in the Bill? The Board is the body which will be asked to interpret the working of the Bill. It is the body which has already pronounced on this very subject. Yet we seem to have stonewalling by the Government, but I hope that I am wrong about that.

The Government have sometimes suggested that the making of productivity agreements has been to cloak price or wage increases, but the Prices and Incomes Board has set out in full the criteria for what a proper productivity bargain or agreement should be. If there is any doubt about it, I will read the lot, but surely the House will accept that.

Mr. Biffen

I have always rather doubted the capacity of the National Board for Prices and Incomes to lay these "tablets" before a wider public. Therefore, I should be interested if my hon. Friend would read them, because I might be educated in the true sense by this process.

Mr. Emery

At this early or, late hour, I am certain that I should not please all hon. Members if I helped towards the education of my hon. Friend.

However, in paragraph 139 of its Report No. 36, the Board states quite clearly: It is for this reason that we indicated in Report No. 23 that it would be wrong to regard a comprehensive productivity agreement as a route to a quick increase in pay I know that many hon. Members have been worried that such agreements might be used to cloak other pay increases. The Board accepts that fear and stresses the need in any proper productivity bargain for what it calls an elaborate plan to control the system and to provide the necessary information and to provide checks to ensure that the agreement works in the manner spelled out. In the guide-lines in that report the Board sets out seven criteria for control and checks.

This is, therefore, what the Government themselves are propounding. Why do they not accept its inclusion in the Bill? Why do they not admit that they have made a howling error of omission, that they had not thought about it, that they were too concerned about control and the problem of inflation and trying to hold down wages and prices and so failed fully to consider—let me be that generous to them—the productivity aspect of the prices, incomes and productivity policy?

Instead of acting like the Prime Minister and believing that if they make a mistake, they have to bat on regardless, taking the view "I can never make an error", it would be healthy for them to admit a mistake and, instead of saying that they believe that the matter will be covered by letting the Board deal with it, agree that a sound argument has been propounded by both sides of the House and that both sides of industry require to be encouraged to work for greater productivity.

If the Government accepted the Amendments—and of course we appreciate that the drafting may not be perfect—they would be exactly following the Board's summary of conclusions in Report No. 36: We conclude that there is a strong case for encouraging the spread of productivity agreements which conform with the requirements of the prices and incomes policy. That is one of the Report's major recommendations. Why will not the Government live up to and accept and carry that through?

I hope that, with the general feeling, not of wanting to kick the Government, but of wanting to encourage them to get on with something essential, which is not a party political matter but the increase of productivity within the whole nation, the Government will not just speak but act, and the best way in which they could act would be to accept the general principle of the Amendment in order to show both sides of British industry that they mean what they say.

Mr. Hattersley

In a constructive speech a little spoilt by the attack on the Government at the end, the hon. Member for Honiton (Mr. Emery), quite rightly distinguished between Amendment No. 24 and the problems of definition surrounding Amendments No. 13 and 44. I hope, having talked about the principal Clause, that I may return to the other Amendment because the problems involved in accepting that are different from those involved in accepting the principal Amendment.

That is the Amendment which seeks to restrict the Government's ability to extend the standstill or implement the 10 or 30 day automatic extension of a wage standstill which results from what is described in the Amendment as a productivity agreement. May I say at the outset to my hon. Friend the Member for Poplar (Mr. Mikardo) that of course the Government accept that this is a serious Amendment, accept the obligation to consider it on its merits objectively and seriously and that my hon. Friend's motives in moving it were no more nor less than to draw attention to the propriety of productivity agreements.

Having made that admission gladly, I have to say, trying to summon up sufficient humility to satisfy my hon. Friend, why I cannot suggest to my hon. Friends that we should accept the Amendment. My hon. Friend the Member for Poplar said that if I were unable to urge acceptance, I should put something in its place. I think he knows that something is already in its place.

Unlike the right hon. Member for Mitcham (Mr. R. Carr), my hon. Friend did not say that there was no mention of productivity in the Bill. Those were the words of the right hon. Gentleman, and in a limited and literal sense, they are true. In this Bill "productivity" does not appear—[Interruption]—if my hon. Friend the Member for Salford, West (Mr. Orme) wants me to correct him as well, I will. It was a point he made as well.

This is a rather narrow definition because this Bill is in all aspects concerned with the parent Act, and to believe that an omission in the second Bill cannot be remedied by something in the first Act is altogether wrong. If the hon. Members will consider Section 4(1) they will find that it requires the Government to refer to Schedule 2 as from time to time amended, and they will see that Schedule 2 consists for the period after 1st July, 1967, of what is White Paper Cmd. 3235. Paragraph 22(i) of that White Paper gave criteria which may be used to allow wage increases to go ahead in the next year: One of them was: where the employees concerned, for example by accepting more exacting work or a major change in working practices, make a direct contribution towards increasing productivity in the particular firm or industry. Even in such cases some of the benefit should accrue to the community as a whole in the form of lower prices;

Mr. Orme

A tortuous journey to arrive at the point.

Mr. Hattersley

While my hon. Friend says it is a tortuous journey to arrive at the point, I hope he accepts that we have arrived at the point in the end. The Government are required by Section 4(1) of the parent Act to take account of the Schedule which lays down positively and definitely that one of the criteria they must consider when allowing or refusing to allow a wage increase to go forward is the increase in productivity.

3.30 a.m.

All that the Government seek to do is to carry out the requirements of the parent Act, and therefore the obligation to investigate productivity agreements and to make sure that the productivity bargain, the productivity agreement, is genuine. I am sure the House understands that unless my hon. Friends are arguing—and I am sure that they are not—for a free-for-all in which people are entitled to dress up a normal wage negotiation as if it were a productivity bargain and foist it on the Government in the guise of a productivity agreement, it is essential that the Government should have some measures and some means whereby they can determine when a genuine productivity agreement exists.

That is really the only point which distinguishes my case from that of my hon. Friend the Member for Salford, West. When he asks whether we have all the day-to-day knowledge—and by "we" I am not sure whether he means the Prices and Incomes Board acting on behalf of the Government, or the Government themselves—to judge when a productivity bargain is genuine and when it is not, I think that he must accept the logical extension of that question. It is this. If he seeks to amend the Bill to instruct my right hon. Friend to accept a productivity agreement whenever one is presented to him, when we do not have the knowledge to decide when an agreement is genuine, and when it is bogus, he is asking my right hon. Friend to do no more and no less than accept anything which is presented to him and called a productivity agreement. I am sure that this is a task which my right hon. Friend, quite rightly and properly, would refuse to accept. But what my right hon. Friend does accept is the right to judge a genuine productivity agreement when he sees it, and not necessarily make that judgment in the form of a reference to, and eventually a report from, the Board. I hope in about two minutes to give some figures of the productivity agreements accepted by the Government During the period of severe restraint—

Mr. Higgins

Will they include the figure for the Birmingham car delivery drivers? The hon. Gentleman says that the Government accept responsibility for distinguishing between a genuine productivity agreement and one which is not, but he said about 12 hours ago that months after this had been referred to him he could not tell whether such a thing was or was not genuine.

Mr. Hattersley

I cannot believe that the hon. Gentleman has forgotten my answer so soon. What I said this afternoon was that the Government would be capable of deciding whether the Long-bridge agreement was a productivity agreement as soon as some evidence was presented to us. I also said that evidence had been hard to come by, and I confirm now that when the evidence is presented we will be capable of deciding whether it constitutes a productivity agreement. The evidence by which we will decide is the evidence laid down initially in Report No. 23 by the N.B.P.I.—the seven criteria for genuine productivity agreements. Certainly, they strike me, and I hope strike my hon. Friends, and some hon. Gentlemen opposite, as reasonable and realistic assessments of what is a genuine productivity bargain.

Let me remind the House of the obligations of the First Secretary under the Act as it stands. He could, if he regarded a wage increase as stemming from a genuine productivity agreement, implement it automatically, and often, using his judgment and deciding that the bargain was genuine, he would choose to do that. The only alternative open to him if he is to postpone the increase is to refer it to the Board, and it is quite clear, under the terms of the Second Schedule to the parent Act, that if the Board found that the agreement was a genuine productivity bargain it would be under an obligation to make a positive recommendation to my right hon. Friend for the wage increase to go forward, and my right hon. Friend would be under an obligation to allow it rather than prohibit it.

I told the hon. Member for Honiton that I accepted his implied criticism.

Sir D. Glover

Can the hon. Gentleman give an instance of his right hon. Friend accepting a productivity agreement?

Mr. Hattersley

The Ministry of Labour has accepted 270 productivity agreements during the period of severe restraint, in the six months ending 1st July this year—

Mr. Biffen

Were they all examined by members of the Civil Service, or was the examination sub-contracted to trade associations?

Mr. Hattersley

The examination was done by members of the Civil Service. The Board's report No. 36 shows that officers of the Ministry made some comments, at the Board's request, about how the original set of criteria could be implemented.

The hon. Member for Honiton mentioned the lack of definition in the principal Amendment. It simply requires my right hon. Friend to implement automatically what are described as "productivity agreements". The difficulty is defining the term and the circumstances in which they would operate. A trade union might believe that it had entered into such an agreement, which did not seem to qualify in my right hon. Friend's terms, and might seek recourse to the courts to determine whether a productivity agreement operated in that ease. My right hon. Friend must have some citeria for approving or referring to the Board productivity agreements, but not the sort which might, because of their omissions, be referred to the courts for definition—

Mr. Orme

My hon. Friend referred to "genuine" agreements, as though employers and trade unions make agreements which are not genuine. I do not know where he spent his life, but mine was spent in industry, where it is not easy to make agreements which are not genuine. This is a slur on industry, and I should like him to explain himself.

Mr. Hattersley

I would explain myself with an example. The Minister of Labour approved a wage increase for the ACROW company of engineers, because he considered that a productivity agreement was involved. But we were told in the House that ACROW had somehow beaten the freeze by arranging what was described as a bogus agreement. I am sure that my hon. Friend realises that some people may be sufficiently determined on a wage increase to dress up an agreement as a productivity agreement. I am not casting a slur on industry or stretching his credulity by asking him to believe that that does happen and that we must ensure that it does not happen within the terms of the policy—

Sir J. Eden

Surely the purpose of offering an increase as part of such an agreement is that the management think they will get better productivity. The hon. Gentleman says this is a bogus proposition, but surely the people to judge are those who will pay the increase.

Mr. Hattersley

Again the hon. Gentleman is tempting me to make more specific and more definite proposals as to what the sort of evasions could be. I agree with him that the nature of a genuine productivity agreement is that more productivity ensues for the company. I am simply saying that one could imagine a situation in which the management might want to co-operate with the trade unions in arranging a wage increase without there being a productivity element but it might be presented to my right hon. Friend the Minister of Labour as if it were.

Because of all these qualifications I would not like the House to imagine that the Government lack enthusiasm for productivity agreements. Indeed, I should have thought that the mere fact that we were creating a situation in which, in general, wage increases were not encouraged, but agreements were encouraged if they were associated with productivity bargains, was an indication of our enthusiasm for arrangements of that sort.

If the House wants any more evidence of our enthusiasm I hope that hon. Members will remember the 270 productivity schemes approved by the Ministry of Labour during the period of severe restraint and the many other productivity schemes approved in local government and allied organisations by the Ministry of Housing. I hope they will remember that specifically Schedule 2 of the parent Act has always included reference to productivity agreements, commending them to industry and promising them special regard.

If any final accolade is needed, I hope the hon. Member for Honiton, who referred the House to Report No. 36 of the National Board for Prices and Incomes, will recall those parts of paragraphs 179 and 181 which he did not read to the House. The judgment of that Report, at the end of paragraph 179, is that a prices and incomes policy can produce the most favourable environment for successful productivity agreements. Lest it be thought that the Prices and Incomes Board is talking in vacuo and saying that any prices and incomes policy can produce a favourable environment for productivity agreements, let me read paragraph 181 of that Report. That paragraph and paragraph 179 are related to each other. Paragraph 181 says: All that we have heard suggests that the effect of Government policy, especially since July 1966, has been to direct the attention of both the employers and trade unionists away from conventional bargaining and towards productivity bargaining. Lest there be hon. Members who join with the hon. Member for Oswestry (Mr. Biffen) and say "So what? The National Board for Prices and Incomes is not to be relied upon on these occasions; its judgment is a little clouded by Government policy anyway. We doubt whether it can take an objective and practical look at industry", let me refer the House to a document which may commend itself to some Members more than anything produced by Mr. Aubrey Jones. I refer to "British Industry", the journal of the C.B.I. In its latest issue, the issue of 7th July, its first leader was a generally critical analysis of productivity agreements. It accused the National Board for Prices and Incomes and, by implication, the Government of being overenthusiastic about the virtues of such agreements.

At the end of paragraph 5, having spent a great deal of time showing all the difficulties and problems which might arise from such agreements, it says: … except, of course, the genuine productivity deal which should pay due regard to the guide-lines set out by the Prices and Incomes Report. That is all that the Government seek to do. If we were to accept the Amendment, due regard to those guide-lines would no longer be possible.

The Government ask that the Amendment should not be accepted, so that productivity agreements can go on if they are legitimate. I believe that they will go on in the same flourishing way that they went on, not during the period of severe restraint but because of the period of severe restraint.

3.45 a.m.

Mr. Higgins

If the hon. Gentleman believes his last few words, he will believe absolutely anything about the Government's policy on prices and incomes. I intervene briefly because many of my hon. Friends wish to speak in what seems to me to be probably the most important individual debate during the whole of our consideration of this Bill. The whole of the rest of the Bill is negative and restrictive. The Amendments are designed to lead to a constructive policy on which a reasonable future can be built for the country.

But it is becoming increasingly apparent from the Government's replies that we can hope for nothing either for the lowest-paid workers and social justice or for productivity and economic growth. It is clear that the Government's view of their policy as it stands is utterly and completely restrictive, and we believe that it is utterly and completely hopeless.

The word "productivity" does not appear in the Bill. It appears only in vague declarations of intent for the "golden era" on which we now look back, when the present Foreign Secretary put forward his initial views on the policy. We are told that we can also hope for more productivity in a future era, when there will apparently be a completely voluntary policy but no free-for-all.

I was surprised to hear the Parliamentary Secretary use those words. He knows as well as I do that arguments put forward by the First Secretary about a free-for-all are completely fallacious. He may argue that everyone is volunteering, yet he gives no explanation why any individual union or firm should volunteer when the Government are in no position to tell them that everyone else will also volunteer. At either end of the spectrum we have a golden age, but in the middle there is a completely restrictive policy that is not likely to result in increased economic growth or prosperity for the country.

I want to take up the whole question of what is a genuine productivity agreement. The Government view some such agreements as being genuine and others as not being genuine. It was pointed out in an earlier speech that apparently the Fawley agreement, which the Government say was good, would not fall within the criteria they have now established. The Parliamentary Secretary made no attempt to answer this point, but I shall gladly give way if he would like to answer it now. Is the Fawley agreement a genuine productivity agreement within the meaning that the Government now understand or not?

Mr. Hattersley

I think that the hon. Gentleman has Report No. 36 in front of him. I said that if there were an issue of doubt, if there were any marginal area where my right hon. Friend the First Secretary was not sure whether or not a productivity agreement was legitimate or genuine, it was his duty and obligation to refer it to the Prices and Incomes Board. Having seen what the Board says about the Fawley agreement in the document which he now holds in his hand, does the hon. Gentleman doubt for a moment that it would have produced a report which said that that was a good thing and that the wage increases should go on?

Mr. Higgins

In that case, all we conclude is that the Board's criteria are not consistent with its views on any particular agreement. This is an absurd situation, but it is typical of the kind of nonsense put forward by the Government.

We must return to what seems to me in many respect to be the typical case of the Birmingham car delivery drivers.

Mr. Mikardo

The point is even stronger than the hon. Gentleman is making it. If the fact is, as I think that he has established, that a determination may be made by the Board on whether a given agreement is all right or not irrespective of the criteria which it lays down, the situation is wide open for its treating some groups of workers and unions as "blue-eyed boys" and making its judgment on whether it happens to like the people concerned. That is a situation which some people suspect already exists.

Mr. Higgins

I could not agree more, because we have maintained consistently throughout the debates on Prayers concerning Orders under the policy that the element of discrimination is fundamental to the Government's whole aproach. We never managed to establish why they should refer a particular case to the Board or make a particular Order. We started by thinking that it was only the weakest individuals who would have an Order slapped on them and then we found that it was the unions which were getting out of line.

The essential point is that the Government, with the criteria set out in Report No. 36 and in the document on the period of severe restraint, are still unable, after months, to establish whether they feel that the Birmingham car delivery workers' agreement is a genuine productivity agreement or not. Yet the Bill only gives power to delay an increase for roughly the period which they have had to make up their mind about whether this agreement was or was not a genuine productivity agreement.

The Parliamentary Secretary says that the Government do not have the evidence on the case, despite the wide publicity and the fact that they have had goodness knows how many conversations with the management and the unions. If they cannot decide this case because they have not got the evidence, how can they hope to get the evidence in any other cases? We are told that 280 agreements have been approved by some anonymous civil servants. We do not know on what basis they have decided—whether on the basis of the criteria set out by the Board, or by reason of some purely arbitrary Government decision based on this or that White Paper, depending how Schedule 2 of the parent Act changes almost from day to day.

The Government are not taking a clear line. They have refused to define what they mean by a "genuine productivity agreement".

Mr. Eldon Griffiths (Bury St. Edmunds)

Is is not a fact that in the 280 agreements referred to by the Parliamentary Secretary there must have been many which were determined before the criteria were laid down? Therefore, there cannot be any consistency.

Mr. Higgins

I do not think for a moment that there is any consistency.

The core of the matter was referred to by the hon. Member for Poplar (Mr. Mikardo), in a speech based on great experience, when he said that the whole idea of a productivity agreement, which was commended by the Prices and Incomes Board, was that certain restrictive practices should be abolished as a result of which an increase in pay was given. These are very tender plants, and we cannot hope to get agreements of this kind if we say, "You must refer the matter to the Government. You must then refer it to the Board" and then in the end say, "We will freeze the whole thing for nine months and you must start again because quite different conditions will then prevail".

This is not a prices, incomes and productivity policy, because the effect of the Government's action has been, as it was in the case of the Birmingham car delivery drivers, not to increase productivity, but to diminish productivity. The whole matter has proceeded in a downward spiral. This is endemic in the approach of the Government in the last year.

The First Secretary may have a grand, global tautology that the important thing is to keep increases in incomes in line with increases in productivity. This is a tautology. It is no criterion as a basis for action. It is something which, if one can bring it about, is true by definition, but nothing which the Government are doing is likely to bring about that desirable state of affairs. They are creating a situation with high unemployment and stagnant production which is likely to bring back the restrictive trade practices which grew up in the 1930s. The sooner they get away from this approach and adopt a sensible approach which encourages increases in productivity, the better it will be. I hope that my right hon. and hon. Friends will support the Amendments.

Mr. John Silkin rose in his place and claimed to move, That the Question be now put:—

Question put, That the Question be now put:

The House divided: Ayes 143. Noes 109.

Division No. 438.]	AYES	[3.55 a.m.
Alldritt, Walter	Fowler, Gerry	Milne, Edward (Blyth)
Ashley, Jack	Fraser, John (Norwood)	Morris, Charles R. (Openshaw)
Atkins, Ronald (Preston, N.)	Freeson, Reginald	Morris, John (Aberavon)
Bacon, Rt. Hn. Alice	Gardner, Tony	Murray, Albert
Bagier, Gordon A. T.	Garrett, W. E.	Newens, Stan
Barnes, Michael	Gray, Dr. Hugh (Yarmouth)	Noel-Baker, Francis (Swindon)
Baxter, William	Grey, Charles (Durham)	Oakes, Gordon
Bence, Cyril	Hamilton, James (Bothwell)	Ogden, Eric
Benn, Rt. Hn. Anthony Wedgwood	Hannan, William	O'Malley, Brian
Binns, John	Harper, Joseph	Owen, Dr. David (Plymouth, S'tn)
Bishop, E. S.	Harrison, Walter (Wakefield)	Page, Derek (King's Lynn)
Blackburn, F.	Hart, Mrs. Judith	Parkyn, Brian (Bedford)
Bradley, Tom	Haseldine, Norman	Pavitt, Laurence
Bray, Dr. Jeremy	Hattersley, Roy	Pentland, Norman
Brooks, Edwin	Hazell, Bert	Rees, Merlyn
Brown, Rt. Hn. George (Belper)	Herbison, Rt. Hn. Margaret	Reynolds, G. W.
Brown, Hugh D. (G'gow, Provan)	Hooley, Frank	Roberts, Albert (Normanton)
Brown, Bob (N'c'tle-upon-Tyne, W)	Howarth, Robert (Bolton, B.)	Roberts, Gwilym (Bedfordshire, S.)
Brown, R. W. (Shoreditch & F'bury)	Howell, Denis (Small Heath)	Robinson, W. O. J. (Walth'stow, E.)
Buchan, Norman	Hoy, James	Roebuck, Roy
Buchanan, Richard (G'gow, Sp'burn)	Huckfield, L.	Rose, Paul
Callaghan, Rt. Hn. James	Hunter, Adam	Shaw, Arnold (Ilford, S.)
Carmichael, Neil	Jackson, Colin (B'h'se & Spenb'gh)	Shore, Peter (Stepney)
Coe, Denis	Johnson, James (K'ston-on-Hull, W.)	Silkin, Rt. Hn. John (Deptford)
Coleman, Donald	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Slater, Joseph
Conlan, Bernard	Jones, T. Alec (Rhondda, West)	Stewart, Rt. Hn. Michael
Crawshaw, Richard	Judd, Frank	Summerskill, Hn. Dr. Shirley
Crossman, Rt. Hn. Richard	Leadbitter, Ted	Swingler, Stephen
Dalyell, Tam	Ledger, Ron	Taverne, Dick
Davidson, Arthur (Accrington)	Lee, Rt. Hn. Frederick (Newton)	Tinn, James
Davies, Harold (Leek)	Lewis, Ron (Carlisle)	Urwin, T. W.
Dell, Edmund	Lomas, Kenneth	Wainwright, Edwin (Dearne Valley)
Dempsey, James	Loughlin, Charles	Walker, Harold (Doncaster)
Dewar, Donald	Lyons, Edward (Bradford, E.)	Watkins, David (Consett)
Diamond, Rt. Hn. John	McBride, Neil	Watkins, Tudor (Brecon & Radnor)
Dobson, Ray	MacColl, James	White, Mrs. Eirene
Doig, Peter	MacDermot, Niall	Whitlock, William
Dunn, James A.	Mackenzie, Gregor (Rutherglen)	Willey, Rt. Hn. Frederick
Dunwoody, Mrs. Gwyneth (Exeter)	Mackie, John	Williams, Alan (Swansea, W.)
Dunwoody, Dr. John (F'th & C'b'e)	Mackintosh, John P.	Williams, Alan Lee (Hornchurch)
Eadie, Alex	Maclennan, Robert	Williams, Mrs. Shirley (Hitchin)
Ellis, John	McMillan, Tom (Glasgow, C.)	Willis, George (Edinburgh, E.)
English, Michael	McNamara, J. Kevin	Wilson, William (Coventry, S.)
Ennals, David	Mallalieu, J. P. W. (Huddersfield, E.)	Woodburn, Rt. Hn. A.
Ensor, David	Manuel, Archie	Woof, Robert
Evans, Ioan L. (Birm'h'm, Yardley)	Mapp, Charles
Fernyhough, E.	Marquand, David	TELLERS FOR THE AYES:
Fitch, Alan (Wigan)	Mason, Roy	Mr. William Howie and
Forrester, John	Millan, Bruce	Mr. Ernest Armstrong.
NOES
Alison, Michael (Barkston Ash)	Gilmour, Sir John (Fife, E.)	Kaberry, Sir Donald
Allason, James (Hemel Hempstead)	Glover, Sir Douglas	Kershaw, Anthony
Astor, John	Glyn, Sir Richard	Kimball, Marcus
Atkins, Humphrey (M't'n & M'd'n)	Goodhew, Victor	King, Evelyn (Dorset, S.)
Baker, W. H. K.	Gower, Raymond	Kirk, Peter
Balniel, Lord	Grant, Anthony	Kitson, Timothy
Biffen, John	Grant-Ferris, R.	Knight, Mrs. Jill
Brewis, John	Griffiths, Eldon (Bury St. Edmunds)	Lambton, Viscount
Bromley-Davenport, Lt.-Col. Sir Walter	Gurden, Harold	Lewis, Kenneth (Rutland)
Brown, Sir Edward (Bath)	Harris, Reader (Heston)	MacArthur, Ian
Bruce-Gardyne, J.	Harvie Anderson, Miss	Macleod, Rt. Hn. Iain
Carr, Rt. Hn. Robert	Hawkins, Paul	Maude, Angus
Chichester-Clark, R.	Heseltine, Michael	Mawby, Ray
Clegg, Walter	Higgins, Terence L.	Maxwell-Hyslop, R. J.
Corfield, F. V.	Hiley, Joseph	Maydon, Lt.-Cmdr. S. L. C.
Dance, James	Hill, J. E. B.	Mills, Peter (Torrington)
Dean, Paul (Somerset, N.)	Hirst, Geoffrey	Miscampbell, Norman
Deedes, Rt. Hn. W. F. (Ashford)	Holland, Philip	Monro, Hector
Dodds-Parker, Douglas	Hordern, Peter	More, Jasper
Eden, Sir John	Howell, David (Guildford)	Morrison, Charles (Devizes)
Emery, Peter	Hunt, John	Munro-Lucas-Tooth, Sir Hugh
Errington, Sir Eric	Hutchison, Michael Clark	Murton, Oscar
Eyre, Reginald	Iremonger, T. L.	Noble, Rt. Hn. Michael
Fisher, Nigel	Jenkin, Patrick (Woodford)	Onslow, Cranley
Fletcher-Cooke, Charles	Johnson Smith, G. (E. Grinstead)	Page, Graham (Crosby)
Fortescue, Tim	Jopling, Michael	Page, John (Harrow, W.)
Pardoe, John	Shaw, Michael (Sc'b'gh & Whitby)	Wells, John (Maidstone)
Peel, John	Sinclair, Sir George	Whitelaw, Rt. Hn. William
Percival, Ian	Smith, John	Wilson, Geoffrey (Truro)
Pink, R. Bonner	Stoddart-Scott, Col. Sir M. (Ripon)	Wolrige-Gordon, Patrick
Price, David (Eastleigh)	Taylor, Sir Charles (Eastbourne)	Wright, Esmond
Prior, J, M. L.	Taylor, Edward M. (G'gow, Cathcart)	Wylie, N. R.
Pym, Francis	Thatcher, Mrs. Margaret	Younger, Hn. George
Ridley, Hn. Nicholas	Turton, Rt. Hn. R. H.
Royle, Anthony	van Straubenzee, W. R.	TELLERS FOR THE NOES:
Russell, Sir Ronald	Walker, Peter (Worcester)	Mr. R. W. Elliott and
Scott, Nicholas	Weatherill, Bernard	Mr. David Mitchell.
Sharples, Richard	Webster, David

Question put accordingly, That the proposed words be there inserted in the Bill:—

The House divided: Ayes 109,Noes 142.

Division No. 439.]	AYES	[4.5 a.m.
Alison, Michael (Barkston Ash)	Heseltine, Michael	Page, Graham (Crosby)
Allason, James (Hemel Hempstead)	Higgins, Terence L.	Page, John (Harrow, W.)
Astor, John	Hiley, Joseph	Pardoe, John
Atkins, Humphrey (M't'n & M'd'n)	Hill, J. E. B.	Peel, John
Baker, W. H. K.	Hirst, Geoffrey	Percival, Ian
Balniel, Lord	Holland, Philip	Pink, R. Bonner
Biffen, John	Hordern, Peter	Price, David (Eastleigh)
Brewis, John	Howell, David (Guildford)	Prior, J. M. L.
Bromley-Davenport, Lt.-Col. Sir Walter	Hunt, John	Pym, Francis
Brown, Sir Edward (Bath)	Hutchison, Michael Clark	Ridley, Hn. Nicholas
Bruce-Gardyne, J.	Iremonger, T. L.	Royle, Anthony
Carr, Rt. Hn. Robert	Jenkin, Patrick (Woodford)	Russell, Sir Ronald
Chichester-Clark, R.	Johnson Smith, G. (E. Grinstead)	Scott, Nicholas
Clegg, Walter	Jopling, Michael	Sharples, Richard
Corfield, F. V.	Kaberry, Sir Donald	Shaw, Michael (Sc'b'gh & Whitby)
Dance, James	Kershaw, Anthony	Sinclair, Sir George
Dean, Paul (Somerset, N.)	Kimball, Marcus	Smith, John
Deedes, Rt. Hn. W. F. (Ashford)	King, Evelyn (Dorset, S.)	Stoddart-Scott, Col. Sir M. (Ripon)
Dodds-Parker, Douglas	Kirk, Peter	Taylor, Sir Charles (Eastbourne)
Eden, Sir John	Knight, Mrs. Jill	Taylor, Edward M. (G'gow, Cathcart)
Emery, Peter	Lambton, Viscount	Thatcher, Mrs. Margaret
Errington, Sir Eric	Lewis, Kenneth (Rutland)	Turton, Rt. Hn. R. H.
Eyre, Reginald	MacArthur, Ian	van Straubenzee, W. R.
Fisher, Nigel	Macleod, Rt. Hn, Iain	Walker, Peter (Worcester)
Fletcher-Cooke, Charles	Maude, Angus	Weatherill, Bernard
Fortescue, Tim	Mawby, Ray	Webster, David
Gilmour, Sir John (Fife, E.)	Maxwell-Hyslop, R. J.	Wells, John (Maidstone)
Glover, Sir Douglas	Maydon, Lt.-Cmdr. S. L. C.	Whitelaw, Rt. Hn. William
Glyn, Sir Richard	Mills, Peter (Torrington)	Wilson, Geoffrey (Truro)
Goodhew, Victor	Miscampbell, Norman	Wolrige-Gordon, Patrick
Gower, Raymond	Mitchell, David (Basingstoke)	Wright, Esmond
Grant, Anthony	Monro, Hector	Wylie, N. R.
Grant-Ferris, R.	More, Jasper	Younger, Hn. George
Griffiths, Eldon (Bury St. Edmunds)	Morrison, Charles (Devizes)
Gurden, Harold	Munro-Lucas-Tooth, Sir Hugh	TELLERS FOR THE AYES:
Harris, Reader (Heston)	Murton, Oscar	Mr. R. W. Elliot and
Harvie Anderson, Miss	Noble, Rt. Hn. Michael	Mr. Timothy Kitson.
Hawkins, Paul	Onslow, Cranley
NOES
Alldritt, Walter	Callaghan, Rt. Hn. James	Edwards, Robert (Bilston)
Ashley, Jack	Carmichael, Neil	English, Michael
Atkins, Ronald (Preston, N.)	Coe, Denis	Ennals, David
Bacon, Rt. Hn. Alice	Coleman, Donald	Ensor, David
Bagier, Gordon A. T.	Conlan, Bernard	Evans, Ioan L. (Birm'h'm, Yardley)
Barnes, Michael	Crawshaw, Richard	Fernyhough, E.
Baxter, William	Crosland, Rt. Hn. Anthony	Fitch, Alan (Wigan)
Bence, Cyril	Crossman, Rt. Hn. Richard	Forrester, John
Benn, Rt. Hn, Anthony Wedgwood	Dalyell, Tam	Fowler, Gerry
Binns, John	Davidson, Arthur (Accrington)	Fraser, John (Norwood)
Bishop, E. S.	Davies, Harold (Leek)	Freeson, Reginald
Blackburn, F.	Dell, Edmund	Gardner, Tony
Bradley, Tom	Dempsey, James	Garrett, W. E.
Bray, Dr. Jeremy	Dewar, Donald	Gray, Dr. Hugh (Yarmouth)
Brooks, Edwin	Diamond, Rt. Hn. John	Grey, Charles (Durham)
Brown, Rt. Hn. George (Belper)	Dobson, Ray	Hamilton, James (Bothwell)
Brown, Hugh D. (G'gow, Provan)	Doig, Peter	Hannan, William
Brown, Bob (N'c'tle-upon-Tyne, W)	Dunn, James A.	Harper, Joseph
Brown, R. W. (Shoreditch & F'bury)	Dunwoody, Mrs. Gwyneth (Exeter)	Harrison, Walter (Wakefield)
Buchan, Norman	Dunwoody, Dr. John (F'th & C'b'e)	Hart, Mrs. Judith
Buchanan, Richard (G'gow, Sp'burn)	Eadie, Alex	Haseldine, Norman
Hattersley, Roy	McMillan, Tom (Glasgow, C.)	Shore, Peter (Stepney)
Hazell, Bert	Mallalieu, J.P.W. (Huddersfield, E.)	Silkin, Rt. Hn. John (Deptford)
Herbison, Rt. Hn. Margaret	Manuel, Archie	Slater, Joseph
Hooley, Frank	Mapp, Charles	Stewart, Rt. Hn. Michael
Howarth, Robert (Bolton, E.)	Marquand, David	Summerskill, Hn. Dr. Shirley
Howell, Denis (Small Heath)	Mason, Roy	Swingler, Stephen
Hoy, James	Millan, Bruce	Taverne, Dick
Huckfield, L.	Milne, Edward (Blyth)	Tinn, James
Hunter, Adam	Morris, Charles R. (Openshaw)	Urwin, T. W.
Jackson, Colin (B'h'se & Spenb'gh)	Morris, John (Aberavon)	Wainwright, Edwin (Dearne Valley)
Johnson, James (K'ston-on-Hull, W.)	Murray, Albert	Walker, Harold (Doncaster)
Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Noel-Baker, Francis (Swindon)	Watkins, David (Consett)
Jones, T. Alec (Rhondda, West)	Oakes, Gordon	Watkins, Tudor (Brecon & Radnor)
Judd, Frank	Ogden, Eric	White, Mrs. Eirene
Leadbitter, Ted	O'Malley, Brian	Whitlock, William
Ledger, Ron	Owen, Dr. David (Plymouth, S'tn)	Willey, Rt. Hn. Frederick
Lee, Rt. Hn. Frederick (Newton)	Page, Derek (King's Lynn)	Williams, Alan (Swansea, W.)
Lewis, Ron (Carlisle)	Parkyn, Brian (Bedford)	Williams, Alan Lee (Hornchurch)
Lomas, Kenneth	Pavitt, Laurence	Williams, Mrs. Shirley (Hitchin)
Loughlin, Charles	Pentland, Norman	Willis, George (Edinburgh, E.)
Lyons, Edward (Bradford, E.)	Rees, Merlyn	Wilson, William (Coventry, S.)
McBride, Neil	Reynolds, G. W.	Woodburn, Rt. Hn. A.
MacCoil, James	Roberts, Albert (Normanton)	Woof, Robert
MacDermot, Niall	Roberts, Gwilym (Bedfordshire, S.)
Mackenzie, Gregor (Rutherglen)	Robinson, W. O. J. (Walth'stow, E.)	TELLERS FOR THE NOES:
Mackie, John	Roebuck, Roy	Mr. William Howie and
Mackintosh, John P.	Rose, Paul	Mr. Ernest Armstrong.
Maclennan, Robert	Shaw, Arnold (Ilford, S.)

Mr. Iain Macleod

I beg to move, That further consideration of the Bill, as amended, be now adjourned. On this occasion I hope that, after a very brief statement from myself and a very brief reply from the First Secretary, I can withdraw the Motion and the House can continue consideration of the Bill. I think that it would be seemly and right for the House to be told now what the First Secretary's intentions are. Clearly, when he replied to an earlier debate the words he used indicated that he did not really expect any longer to get the whole of the Bill, much less the Order, tonight. It is now dawn and we have not completed Clause 1. Although the First Secretary might be disappointed with this progress, I do not think that anybody in the House, with the exception of the Leader of the House, will be surprised, because this is an extremely difficult Bill. I therefore hope that the First Secretary will, if he cannot agree to stop now, set a target a fairly short distance ahead on the Order Paper which we may be able to accept and work towards.

4.15 a.m.

Mr. M. Stewart

I do not think that we should adjourn consideration now, but I take the right hon. Gentleman's point about setting a target for how far we should get at this stage. We must accept that it will be necessary for the House to resume some part of the discussion on the Bill and Order tonight, after ten o'clock. I am anxious that that should not be too heavy an assignment for the House.

This could be achieved if, with the co-operation of the House, we could get as far as the end of Clause 2 before we rise. If we could all agree that this target would be reasonable, I would ask the right hon. Gentleman to withdraw his Motion.

Mr. Iain Macleod

I am grateful to the First Secretary for his response. There is a complication in that I can speak only for this side of the House, and there are other oppositions, of which I am not the spokesman. The proposal made by the First Secretary is reasonable. He says that it will be necessary to go on tonight, at ten o'clock. That will mean a series of all night sittings, which have their own complications and which bring their own strains.

The only point in that case, because we should not do these matters beneath the rules in the small hours of the morning, is to ask the right hon. Gentleman to ask his right hon. Friend the Leader of the House to make a short business statement at 3.30 p.m. I do not ask for an answer now, but if the First Secretary would convey that to the Leader of the House it would be for the convenience of the House.

Hon. Members

Where is he?

Mr. Macleod

Wherever he is, I am about to ask leave to withdraw my Motion.

Motion, by leave, withdrawn.

Mr. Stan Newens (Epping)

I beg to move Amendment No. 14, in page 2, line 9, at the end to insert: (3) The provisions of subsections (1) and (2) of this section shall be disregarded in determining the pension of any employee. The object of this Amendment is to prevent any long-term restriction on a pension, which was surely not intended by the Bill. The intention of the Bill is to provide a limited standstill of incomes, but the possible effect of the Bill, as drafted, is to reduce the level of pension, it appears for the rest of his life, of a person at present employed. It is necessary for me to expand this by pointing out that some employees' pensions depend on the average earnings during their last years of employment.

For example, in the case of teachers, the amount of the annual pension depends on two factors: the length of service and the average salary earned during the last three years of teaching. Teachers get one-eightieth of the average of the last three years' earnings for each year of service. There are many superannuation schemes which have a similar form for salaried staffs in other occupations.

This means that if earnings during the course of the last year during which a person is employed are prevented from rising by the effect of this Bill, when it becomes law, then the average earnings for the course of the last three years, or whatever the requisite period may be, will be reduced and the best figure for calculating the annual pension of any person will be reduced. This means that the best figure for calculating the annual pension of any person thus affected would be reduced and, accordingly, his pension rights for life. If an employee failed to qualify during the course of the last year for, say, £39, if my arithmetic is right, he would incur a loss of 5s. a week, or £13 per annum for the rest of his life.

This does not merely apply in cases of pensions paid out in weekly or monthly sums; it applies also in those cases in which a lump sum is paid out at the end of the employee's service because the lump sum is also based on a formula rather similar to the formula which I have described.

In the case of teachers, with which I am familiar, the lump sum is dependent once again on the last three years of earnings. In fact the teacher receives by way of lump sum 3/80ths, times the period of service, times the average salary in the last three years, and similar arrangements prevail in other occupations.

At this time, I have no intention of wearying the House by adding to the example I have already quoted. It suffices to say that there are many employees who will suffer lasting loss as a result of the effects of this Bill. I believe it is totally unjust to deprive an employee of part of his retirement pension for life. It is surely enough for the employee to be obliged to tolerate the standstill and lose earnings during the final year of his employment, and it is really an injustice which was surely in no way envisaged or intended by the Bill originally that a person should be penalised for life, and I can see no reason whatsoever for perpetuating this arrangement.

In these circumstances, I very much hope that my right hon. Friend will agree to accept the Amendment. After all, if he does agree to accept this it will not in any way frustrate the purposes of the Bill which he has set forth as far as the period of the standstill is concerned. But if he will accept the Amendment an injustice will be prevented which will particularly apply as between different people who happen to retire at different times. One individual who retires, let us say, three or four months' later than another individual, might get an enhanced pension which his colleague, who retired a little earlier, was not entitled to. In these circumstances, I think there is a very good case indeed for my right hon. Friend to give very careful consideration to this Amendment, and I hope he will agree to accept it.

Sir D. Glover

I am astonished that the hon. Member for Epping (Mr. Newens) has had to move this Amendment. I cannot understand why the Government did not accept, long before we reached this stage of the Bill, what the hon. Member is after in his Amendment.

We all know that there is anger and bitterness among people who are deprived of the increases they otherwise would have got in their wages or salaries for one period of 12 months, but at the end of the 12 months with any luck they may get their rises when the matter has been in front of the Prices and Incomes Board, and all they have lost is perhaps nine months' or 12 months' of their increases.

But when one is dealing with pensions one is dealing with a totally different picture. I am not going to delay the House, after the good example given by the hon. Member, but so many people's pensions are geared to their earnings, particularly in the last years, not just in the teaching profession but in many other professions; or it is an amalgam of their total earnings and their highest earning year affects their pension very severely. In some cases, such as in the teaching profession, it is assessed over the last three years of their earnings, and unless there is an alteration here we are providing for a permanent reduction in that person's retirement pay, not for one year but perhaps for 5, 10, 20 or even 25 years. It is not impossible for somebody who retires at 65 to live to be 90. I am told that the average age now is over 80. So there is nothing extraordinary in someone retiring at 65 and living to 90. Such a person will suffer a reduction in pension for 20–25 years.

I am sure that this was never the intention of the Government when they started the campaign of freeze and squeeze. I am sure that it was never envisaged that this would happen to the pensioner on a permanent basis. I hope that the First Secretary will not give a reply to the Amendment bringing in the cap-trap, to use the expression used by h is hon. Friend, that this is only a follow-up Bill from the previous Measure and that the other Measure was the father Measure. If in the father Measure there were some anomalies and injustices, I should have thought that the fact that the Government had to bring in another Bill would have given them an opportunity to put the anomalies right.

It is not sufficient to say that the Bill is based on what was in the previous Measure. If that is the case, the Minister ought not to have brought in a Bill which was a duplicate of the other Measure; he should have brought in a Bill to deal with the problem and remove the anomalies that we have been discussing on the Amendments moved by h3n. Gentleman opposite. Those anomalies could have been removed had greater care been taken in producing the Bill.

There is no party issue in this. There is not even an ideological issue in it between the Left and Right in the Labour Party. It is a matter of simple justice. In many cases the people concerned were able to assess 10 years ago how much they were likely to draw in pension, knowing their salary scales and the increments and also their expectations. But the freeze has upset their calculations about what they would have on retirement. They may have entered into the purchase of a cottage. Because of the arbitrary alteration their income will be reduced by £13, £15 or even £20 or more a year, which will make all the difference to their standard of living—and that will go on for the remainder of their life. This is just because the Government wanted to have a flat standstill for a period of one or two years.

What has astonished me throughout our debates tonight is the little appreciation that has come from the Government Front Bench of what really goes on on factory floors between human beings negotiating and what goes on in households. I hope that the right hon. Gentleman will be able to accept his hon. Friend's Amendment, because I believe it represents just simple justice.

Mr. Gerry Fowler (The Wrekin)

As a very firm supporter of my right hon. Friend's prices and incomes policy, I hope that he will be able to make a concession on this issue. Many of us have constituents who in the past 12 months have already been adversely affected by the policy. This is a matter of simple justice to most of us. It is very hard to understand why a man should be penalised for the rest of his life. In the majority of cases those affected are not likely to be among the better off sections of the community.

4.30 a.m.

A person who has retired is not likely to have superfluous means and it seems unfair that, because of the provisions of a policy which, in its present form, is unlikely to last more than two years, a person should be penalised in this way for the rest of his life by being unlucky enough to have been caught in this period.

I must correct the hon. Member for Ormskirk (Sir D. Glover) on one point. This does not really apply to a man who has been calculating for 10 years what he will receive well knowing that he is on a regular incremental scale. The policy has not affected the man on an incremental scale and the hon. Gentleman's point is therefore irrelevant. But the basic argument stands and I hope that my right hon. Friend will be able to make some concession.

Mr. John Page (Harrow, West)

I support the Amendment on grounds of common fairness and sincerely hope that the Government will accept it. It is improper to ask a small number of people to carry for the rest of their lives a burden which was placed on the whole country for a few years. I will give two specific instances of hardship caused by this aspect of Government policy. Both persons concerned were connected with Government service, one directly and the other in a nationalised industry.

The first concerns the extraordinary case of the engineering grades in the Post Office, where some of the senior grades did not have their review agreed before last July while some of the junior grades had their increases agreed. A man promoted from a junior to senior grade may be worse off, and if he retires during this promotion year he will actually receive, because he was promoted, a lower pension than he would otherwise have got.

The second case is that of a constituent who came to see me today. He retired in May. He was in a senior managerial grade of British Railways. He was not allowed to receive an increment in his last year of service, which could have been about 5 per cent. His loss in pension rights will be about £100 a year for good. He also suffered a substantial loss in the lump sum retirement payment.

My constituent had an interview with the Senior Personnel Director of British Railways, who explained that if the British Railways Board could grant him the increase so far as his pension was concerned, it would willingly do so. But the Board has been in touch with either the Treasury or the Ministry of Transport and has been told that it is not Government policy that this should be done, and that it may not do it. This is a definite intervention with a nationalised industry by Government Departments who have said, "You may not take into consideration the increase which this long-service senior employee would have received and he will now make this sacrifice."

He would be prepared, as would many other pensioners in the same position, to forgo an increase in pension at the full rate for a year or two.

Mr. Biffen

I understand that the advice tendered by the Government is that it is illegal for British Railways to make these arrangements or that the making of these arrangements would be contrary to the spirit of the Government's policy. I think the distinction is very germane.

Mr. Page

I must be careful here. As I understand it, strong pressure was brought on the British Railways Board not to grant this. If I said it was illegal, I was speaking outside my definite knowledge. However, it asked for the advice, the advice was given, and it accepted the advice and is proposing to act on it. If I said it was illegal I was probably wrong. Nevertheless, the pressure was strong enough to make it take the action that it did.

I was saying that I am sure that pensioners in this position would be willing to forgo for a year or two, or during the period of a continued squeeze or freeze, the increase which would be legitimately theirs. If it was put to them I am sure that they would accept it, but they do not consider that it would be fair or equitable or just that they should be asked for the rest of their lives to carry the severe handicap which is their lot, because they happened to retire during the lifetime of the present Government. I therefore sincerely ask the Government to accept the Amendment or make a proposal similar to it.

Mr. Sydney Bidwell (Southall)

If I sense the mood of the House aright, it has just about had enough. I am conscious that this is not my finest hour, but since I have been sitting here for many a long hour waiting to take part in this section of the debate I should like to add a couple of points and make an appeal to my right hon. Friend. I also justify my intervention at this late, or early, hour on the ground that I have had several representations from constituents from time to time raising this very point.

I have looked at the Amendment very carefully and I have some knowledge, because of the kind of work that I did before I came to the House, of pensions and superannuation schemes, which vary enormously from industry to industry and from occupation to occupation. Sometimes there are none at all, as we recognise in our Labour Party policy on national superannuation ideas etc. Nevertheless, I accept the wisdom of the Amendment that has been suggested. If it is not possible to accept the exact wording, I hope that my right hon. Friend will at least accept the spirit or the intention of what was required.

Pension schemes can be fixed schemes which have little relationship to earnings, but are assessed from time to time and are sometimes the subject of employer and trade union negotiation. On the other hand, superannuation schemes depend very much on worker-employer contributions based on a percentage system, and schemes of this kind can be adversely affected. Although automatic annual incremental scales are not very much affected, such things as merit money and merit payments in industry are affected and that can have an adverse effect on pensions, and that is not right.

Not long ago, I was reading that boards of directors of limited liability companies salt away funds for pensions rights for directors, sometimes to a tune which exceeds what is paid in directors' fees. This is in order to ensure that directors do not have a big reduction in their standards of living when they start to get on in life. I would not like a Labour Government of all Governments to have been instrumental in exercising one law for the poor and another for the better-off sections of industry, who are better off than the average worker can hope to be.

In view of the sequence of events and what my right hon. Friend the First Secretary has said about the way in which this policy has developed, from the declaration of intent to the freeze, to the period of severe restraint and now into a period of restraint, making this first concession and accepting what is implied in the Amendment would go along quite comfortably with the whole notion of the future period of restraint. If the Government cannot accept the exact wording of the Amendment, I hope that they will accept its spirit and intention and will closely study it.

Mr. Biffen

The hon. Member for Southall (Mr. Bidwell) prefaced his remarks with a charming and understandable apology for detaining the House at this hour of the morning. He should not be so modest, for at this hour vigilance and will-power are often more needed than ever before. It is just an accident of time that we happen to be considering this Amendment at a quarter to five in the morning. That is no reason why we should take a more leisurely attitude than if we were discussing it at half-past eight or half-past nine. I know that this will appeal particularly to the hon. Member for Poplar (Mr. Mikardo), because if there is anything which we have learned from the Prices and Incomes Act it is that when it was tested in the courts, it was often adjudged to be other than hon. Members had assumed on the guarantee of the Treasury Bench.

The hon. Member for Epping (Mr. Newens) has rightly drawn attention to the fact that this legislation might have a continuing deleterious effect on pension rights and that the pension of anyone might be affected by a standstill on his earnings for six months. I do not read the Bill as indicating that inevitably someone will suffer the harmful consequences of the Bill to his pension rights.

4.45 a.m.

I am prepared to believe that many more nuances can be read into this than I, as a layman, possibly could, but it is quite clear that it is possible for an employer retrospectively to pay whatever increase was delayed by the Prices and Incomes Board, and this leads me to think in terms of pension arrangements. It would be possible for some retrospective arrangements to be made. It is not clear, and that is why the House should properly concern itself with this at this hour. We want clarification and clarification of a rather higher order than on the Act last year, because we do not want the House to be held to ridicule by adverse and distinguished judicial comment on the quality of the legislation when it was finally tested in the courts by the kind courtesy of Mr. Clive Jenkins.

I support this probing Amendment for a reason touched on by the hon. Member for Southall—that it seeks to say that the provisions of subsections (1) and (2) shall be disregarded in determining the pension of any employee.

Subsection (1) opens: Where by virtue of a reference to the National Board for Prices and Incomes. … We are constantly going back to this problem that we are discussing a catalogue of people who will be placed in a specific situation because they have been selected for reference to the National Board for Prices and Incomes. We cannot peer into the future and determine with any exactitude what kind of people are likely to be referred, but it is pretty clear that it is likely to be people whose incomes are collectively determined, perhaps Government employees, perhaps those organised by what the Government deem to be a militant union.

When we discussed pensions, the hon. Member for Southall rightly drew attention to the considerable development of pensions schemes for many people who are certainly non-unionists. I will not engage in what might be thought pejorative words about executive suites, but the provision of top hat pension schemes is encouraged by this legislation, with the more sophisticated payment of total emolument, if one wants to use these rather ponderous terms, and the trend is increasingly towards fringe benefits for this kind of person. It is perfectly reasonable for the hon. Members for Reading (Mr. John Lee) and for Southall to see in the working out of this policy, if it is ever put into legislative action, a discrimination which will tend to be to the disadvantage of the lower-paid. I think this is a fair inference.

The Secretary of State may say that I am conjuring up a totally false proposition, but if the alternative is that the Prices and Incomes Board is to be diverted to considering the incomes of the odd two or three individuals, the counter-proposition is to my mind even more improbable. I think that the hon. Member for Epping is to be congratulated on putting down this Amendment, and I hope that if hon. Gentlemen opposite are not satisfied with the answer they get from the Government they will make history by voting against their own leadership.

Mr. Eldon Griffiths

I wish briefly to support the Amendment, in particular on behalf of a group in which, as the House knows, I have a special interest, namely, the police.

There are three features of police pensions which will make them particularly vulnerable to the Bill if it is not amended in the way proposed. First, many policemen are compulsorily retired at a very early age, owing to the physical nature of the job. There is, therefore, no question in their case of hanging on for a few years until the prices and incomes policy has left us. They have to go at this early age. They have no choice.

Secondly, they receive their pensions at a relatively early age, in many cases by the age of 50. This means that they are sent out on pension at a lower rate than they could have expected to get without this policy, and there is a very much longer period of their lives during which they suffer from this discrimination.

Thirdly, the police pension is relatively generous. This is not, perhaps, the view that I take when I am dealing with the Whitley Council, but it is a relatively generous pension, in large measure because it is contributory. Therefore, to the extent that there is discrimination, it is apt to be one that is more felt by this group.

From the contacts that I have had with the official side of the Whitley Council on this matter, I have formed the strong impression that the Government are not at all happy about the situation, and that there is real hope that they will deal with this question. I hope that when the right hon. Gentleman replies to the debate he will, if he is not able to give us complete satisfaction, at least give more hope—I believe that there is already some—to these people in the public service who are particularly concerned about the present situation.

Mrs. Margaret Thatcher (Finchley)

I, too, would like briefly to support the Amendment, because many of the points have been advanced in some detail, and we have learned exactly what is in the mind of the hon. Member for Epping (Mr. Newens).

I think that the First Secretary will remember that we0 have discussed this before, when we discussed the White Paper on the standstill and severe restraint. As I undersand it, the position is that people who are on the point of retiring now will already suffer from the period of standstill and the period of severe restraint during which their salaries or incomes have been virtually frozen. Thus, in so far as they retire now on pension, and the pension is determined by reference to a fraction of their final salaries, or their salaries throughout their working lives, they will suffer considerable damage, which at the moment we can do nothing to restore. Without the Amendment, they will suffer further damage. The Amendment seeks to prevent that further damage from being suffered, and therefore to mitigate the consequences on these people.

I suspect that the First Secretary will say that it is impracticable to do it, and very difficult, and so on, because there are so many different ways of calculating pensions. He will probably say that a person who is 10 years before retirement will also suffer if his pension is calculated by reference to one-fortieth of his yearly salary. This is true, but the people who will suffer most are those whose pensions are calculated by reference to three years of final salary, and who are about to retire now.

I join my hon. Friends and hon. Gentlemen opposite who have pleaded this case, and I think that we must press the right hon. Gentleman to ensure that as far as possible the effect on the people to whom I have referred is mitigated. The Amendment is wider than was indicated. It could apply not only to pension entitlement, but to existing pension rights. Although it refers to the pension of "any employee" and not that of a former employee, a number working for one company could be on pension.

What is the position of those with rights under occupational pension schemes, which cover about 12 million people, although only about two or three million are drawing the pensions under Sections 379 and 388 of the Income Tax Act? There are also a number of gratuitous pensions. These pensions could also be referred to the Board under the 1966 Act, because they are "other kinds of income". We asked about this position in discussing the White Paper on severe restraint. Perhaps the right hon. Gentleman would make it clear that, if any company wished to put up the pension of former employees, it would not be referred to the Board.

This should not be done, as these people must suffer a considerable drop in income in any even event. For those on pension every extra £ or few shillings contributes directly to a standard of comfort or standard of living. I hope that the right hon. Gentleman will be forthcoming both on the calculation of pension entitlement—enabling us to mitigate the effects on those whose entitlement is still being determined—and with the assurance that, if any firm wishes to put up occupational pensions which are being drawn, there will be no reference to the Board.

Mr. M. Stewart

The speeches have been made with knowledge and feeling in this debate. The hon. Member for Finchley (Mrs. Thatcher) said that I could point out the great procedural difficulties of complying with the Amendment, but I do not propose to do that, although it would involve a thorough search of pension schemes and probably the alteration of a number of Statutes. But even those formidable difficulties would not be sufficient reason in themselves for refusing the Amendment.

There are, however, difficulties which have not been fully understood. First, I fully accept what has been said about the position of those affected by the standstill, but the Amendment does not and cannot affect them. We must ask what group of people could be affected and in what context we are now considering the pension problem. It is quite different from that of people who have been hurt under the standstill which is now coming to an end. Implicit in the Bill is that any agreement should be notified before it is negotiated, and employers and employed are asked, in deciding whether to press a claim or make a settlement, to have regard to the criteria prevailing during this period, which are, of course, different from and more generous than those of the past.

The only groups of people to whom this Amendment could apply would be those who had agreed with their employers on a settlement which was, in fact, out of line with the criteria which had been explained and which they knew in advance. If they had done that and if, as a result and following a reference to the Board, a standstill Order had been made in their case, if this Amendment were made it would apply to them but to them only.

5.0 a.m.

Contrast their position with a group of employees whose employer had declined to make an agreement in conflict with the standstill. They would not benefit from this Amendment. Once again, this would be the kind of Amendment where anybody—any group of employees or employers—who had agreed, without pressing things to the point where the standstill Order was made, to respect the criteria that prevailed during this period, there would he no question of benefiting from this Amendment. The only group who could benefit from the Amendment would be those who first endeavoured to make a settlement but contravened the criteria, and in consequence had a standstill Order made against them. That would not be a position that one could defend.

I have considered, therefore—and I considered this the more as I listened to the debate—whether there is any way round this difficulty. Could one, for example, not only bring into pension calculation a definite increase that had been agreed and then disallowed by virtue of a standstill Order, but also start working out what increases people might have got and what increases their employers might have agreed to if it had not been for the whole tenor of the policy and the whole nature of the economic circumstances in which we are now living? I have regretfully come to the conclusion that really that would be an impossible task.

Do we not here meet something that is inherent in all pensions problems? If the man's pension is calculated, as some are, on the average of, in some cases, the last three years of his salary, it will be apparent that somebody who had the ill luck to reach the end of his working life during a period, for any reason—whatever Government action might be—when money wages were not tending to rise, would be in a worse position than somebody whose last three years of working life occurred during a period when money wages were decidedly going up. That is the real anomaly about which hon. Members are complaining.

That could not be remedied by an Amendment of this kind. Remedies might be sought in other ways. For instance, some might argue that this indicates the unwisdom of calculating pension solely with reference to an average of the last few years of working life—although, of course, there are arguments in favour of doing it that way; but it seems to me, however one argues this, that one cannot come to the conclusion that this Amendment remedies what is the real nature of the problem.

All the Amendment would do would be to produce what I suggest is the unsatisfactory result that people who had accepted the criteria would not benefit and that people who had tried not to accept the criteria and then had been required to do so would benefit. It is possible, as the hon. Member for Oswestry (Mr. Biffen) suggested, that the employer himself might decide that if there were groups of his employees who were likely to be specially hard hit by this, he might take action to remedy it. It would be quite wrong of me to say anything that would encourage retrospective payments, but they would definitely not be illegal.

I find it difficult to answer completely the question asked by the hon. Lady, which summons up rather hypothetical circumstances. Her question of whether certain pensions would be referred to the Board in certain cases is rather complicated. So far as I can answer such a question off the cuff, I must reply that I cannot envisage circumstances in which it would be right to refer such an increase to the Board. I am afraid that that is as far as I can go.

Mr. John Page

I followed most clearly the points the right hon. Gentleman has made and see the snags in the Amendment. Would it be within the spirit of Government policy for an individual who has not received an increase in the last year before retirement to come to an arrangement with his employer to receive a pension on the basis that he had received such a payment? Would that he something that the right hon. Gentleman would advise?

Mr. Stewart

I could not possibly advise it. I cannot say more than I said in reply to the hon. Member for Oswestry, that it is clear that the Bill does not make that illegal.

Hon. Members

What does that mean?

Mr. Stewart

It means exactly what it says. One can imagine a great many courses of action which are not illegal but which we would not necessarily advise people to pursue.

Mr. Eldon Griffiths

It is one thing for a private employer to take the view that an action is not illegal, but it is a very different matter for the official side of a Whitley Council. It would require rather more direction than the right hon. Gentleman has given.

Mr. Stewart

I could not advise this course of action. That is plain enough. I remind the House that one of the things we must keep in mind in the whole argument about prices and incomes is that in the end what matters to all is the real value of the money they receive. If, as a result of not being as restrictive as circumstances oblige us to be, we greatly

damage the value of money, pensioners will be among those who suffer most.

There has been mention in the debate of letters that hon. Members have received about the policy. I too have received letters about it, and hon. Members may be surprised to learn that some of them cheer me on and encourage me in the implementation of the policy. The one I have in mind now, which represents not an individual but a whole group of people, was from a pensioners' association, which felt that it was to people like its members that the maintenance of the value of money was of the greatest importance.

I hope that the House will believe that I have listened to the debate sympathetically and tried to see if there were a way of dealing with the matter. I refuse the Amendment only because I honestly do not believe that there is, except in a way which would only be enormously administratively difficult. That would not by itself be an overwhelming objection, but it would in addition create more anomalies and injustices than it sought to rectify.

Therefore, I must with regret, but without hesitation, ask my hon. Friends to withdraw the Amendment.

Question put, That those words be there inserted in the Bill:—

The House divided: Ayes 108, Noes 141.

Division No. 440.]	AYES	[5.10 a.m.
Alison, Michael (Barkston Ash)	Glyn, Sir Richard	Kitson, Timothy
Allason, James (Hemel Hempstead)	Goodhew, Victor	Knight, Mrs. Jill
Astor, John	Gower, Raymond	Lambton, Viscount
Atkins, Humphrey (M't'n & M'd'n)	Grant, Anthony	Lewis, Kenneth (Rutland)
Baker, W. H. K.	Grant-Ferris, R.	MacArthur, Ian
Balniel, Lord	Griffiths, Eldon (Bury St. Edmunds)	Macleod, Rt. Hn. Iain
Biffen, John	Gurden, Harold	Maude, Angus
Brewis, John	Harris, Reader (Heston)	Mawby, Ray
Bromley-Davenport, Lt.-Col. Sir Walter	Harvie Anderson, Miss	Maxwell-Hyslop, R. J.
Brown, Sir Edward (Bath)	Hawkins, Paul	Maydon, Lt.-Cmdr. S. L. C.
Bruce-Gardyne, J.	Heseltine, Michael	Mills, Peter (Torrington)
Carr, Rt. Hn. Robert	Higgins, Terence L.	Miscampbell, Norman
Chichester-Clark, R.	Hiley, Joseph	Mitchell, David (Basingstoke)
Clegg, Walter	Hill, J. E. B.	Monro, Hector
Corfield, F. V.	Hirst, Geoffrey	More, Jasper
Dance, James	Holland, Philip	Morrison, Charles (Devizes)
Dean, Paul (Somerset, N.)	Hordern, Peter	Munro-Lucas-Tooth, Sir Hugh
Deedes, Rt. Hn. W. F. (Ashford)	Howell, David (Guildford)	Murton, Oscar
Dodds-Parker, Douglas	Hunt, John	Noble, Rt. Hn. Michael
Eden, Sir John	Hutchison, Michael Clark	Onslow, Cranley
Elliott, R.W. (N'c'tle-upon-Tyne, N.)	Iremonger, T. L.	Page, Graham (Crosby)
Emery, Peter	Jenkin, Patrick (Woodford)	Page, John (Harrow, w.)
Errington, Sir Eric	Johnson Smith, G. (E. Grinstead)	Pardoe, John
Eyre, Reginald	Jopling, Michael	peel, John
Fisher, Nigel	Kaberry, Sir Donald	Pink, R. Bonner
Fletoher-Cooke, Charles	Kershaw, Anthony	Price, David (Eastleigh)
Fortescue, Tim	Kimball, Marcus	Prior, J. M. L.
Gilmour, Sir John (Fife, E.)	King, Evelyn (Dorset, S.)	Pym, Francis
Glover, Sir Douglas	Kirk, Peter	Ridley, Hn. Nicholas
Russell, Sir Ronald	Taylor, Edward M. (G'gow, Cathcart)	Wilson, Geoffrey (Truro)
Scott, Nicholas	Thatcher, Mrs. Margaret	Wolrige-Gordon, Patrick
Sharples, Richard	Turton, Rt. Hn. R. H.	Wright, Esmond
Shaw, Michael (Sc'b'gh & Whitby)	van Straubenzee, W. R.	Wylie, N. R.
Sinclair, Sir George	Walker, Peter (Worcester)	Younger, Hn. George
Smith, John	Webster, David
Stoddart-Scott, Col. Sir M. (Ripon)	Wells, John (Maidstone)	TELLERS FOR THE AYES:
Taylor, Sir Charles (Eastbourne)	Whitelaw, Rt. Hn. William	Mr. Anthony Royle and
		Mr. Bernard Weatherill.
NOES
Altdritt, Walter	Fernyhough, E.	Millian, Bruce
Armstrong, Ernest	Fitch, Alan (Wigan)	Milne, Edward (Biyth)
Ashley, Jack	Forrester, John	Morris, Charles R. (Openshaw)
Atkins, Ronald (Preston, N.)	Fowler, Gerry	Morris, John (Aberavon)
Bacon, Rt. Hn. Alice	Fraser, John (Norwood)	Murray, Albert
Bagier, Gordon A. T.	Freeson, Reginald	Noel-Baker, Francis (Swindon)
Barnes, Michael	Gardner, Tony	Oakes, Gordon
Baxter, William	Garrett, W. E.	Ogden, Eric
Bence, Cyril	Gray, Dr. Hugh (Yarmouth)	O'Malley, Brian
Benn, Rt. Hn. Anthony Wedgwood	Grey, Charles (Durham)	Owen, Dr. David (Plymouth. S'tn)
Binns, John	Hamilton, James (Bothwell)	Page, Derek (King's Lynn)
Bishop, E. S.	Hannan, William	Parkyn, Brian (Bedford)
Blackburn, F.	Harrison, Walter (Wakefield)	Pavitt, Laurence
Bradley, Tom	Hart, Mrs. Judith	Pentland, Norman
Bray, Dr. Jeremy	Haseldine, Norman	Rees, Merlyn
Brooks, Edwin	Hattersley, Roy	Reynolds, G. W.
Brown, Rt. Hn. George (Belper)	Hazell, Bert	Roberts, Albert (Normanton)
Brown, Hugh D. (G'gow, Provan)	Herbison, Rt. Hn. Margaret	Roberts, Gwilym (Bedfordshire, S.)
Brown, Bob (N'c'tle-upon-Tyne, W)	Hooley, Frank	Robinson, W. O. J. (Walth'stow, E.)
Brown, R. W. (Shoreditch & F'bury)	Howarth, Robert (Bolton, E.)	Roebuck, Roy
Buchan, Norman	Howell, Denis (Small Heath)	Rose, Paul
Buchanan, Richard (G'gow, Sp'burn)	Howle, W.	Shaw, Arnold (Ilford, S.)
Callaghan, Rt. Hn. James	Hoy, James	Shore, Peter (Stepney)
Carmichael, Neil	Huckfield, L.	Silkin, Rt. Hn. John (Deptford)
Coe, Denis	Hunter, Adam	Slater, Joseph
Coleman, Donald	Jackson, Colin (B'h'se & Spenb'gh)	Stewart, Rt. Hn. Michael
Conlan, Bernard	Johnson, James (K'ston-on-Hull, W.)	Summerskill, Hn. Dr. Shirley
Crawshaw, Richard	Jones, Rt. Hn. Sir Elwyn (W. Ham, S.)	Swingler, Stephen
Crosland, Rt. Hn. Anthony	Jones, T. Alec (Rhondda, West)	Taverns, Dick
Crossman, Rt. Hn. Richard	Judd, Frank	Tinn, James
Dalyell, Tam	Leadbitter, Ted	Urwin, T. W.
Davidson, Arthur (Accrington)	Ledger, Ron	Wainwright, Edwin (Dearne valley)
Davies, Harold (Leek)	Lee, Rt. Hn. Frederick (Newton)	Walker, Harold (Doncaster)
Dell, Edmund	Lewis, Ron (Carlisle)	Watkins, David (Consett)
Dempsey, James	Lomas, Kenneth	Watkins, Tudor (Brecon & Radnor)
Dewar, Donald	Loughlin, Charles	White, Mrs. Eirene
Diamond, Rt. Hn. John	Lyons, Edward (Bradford, E.)	Whitlock, William
Dobson, Ray	MacColl, James	Willey, Rt. Hn. Frederick
Doig, Peter	MacDermot, Niall	Williams, Alan (Swansea, W.)
Dunn, James A.	Mackenzie, Gregor (Rutherglen)	Williams, Alan Lee (Hornchurch)
Dunwoody, Mrs. Gwyneth (Exeter)	Mackie, John	Williams, Mrs. Shirley (Hitchin)
Dunwoody, Dr. John (F'th & C'b'e)	Mackintosh, John P.	Willis, George (Edinburgh, E.)
Eadie, Alex	Maclennan, Robert	Wilson, William (Coventry, S.)
Edwards, Robert (Bilston)	McMillan, Tom (Glasgow, C.)	Woodburn, Rt. Hn. A.
English, Michael	Mallaiieu, J.P.W. (Huddersfieid, E.)	Woof, Robert
Ennals, David	Manuel, Archie
Ensor, David	Mapp, Charles	TELLERS FOR THE NOES:
Evans, Ioan L. (Blrm'h'm, Yardley)	Mason, Roy	Mr. Joseph Harper and
		Mr. Neil McBride.

Mr. Kenneth Lewis (Rutland and Stamford)

On a point of order. Before we move on to the next Amendment, Mr. Deputy Speaker, may I ask, it being five o'clock in the morning—

Hon. Members

Where has the hon. Gentleman been?

Mr. Lewis

I apologise. It is nearly half past five. May I ask the Leader of the House—[HON. MEMBERS: "Where is he?" —or the Government Chief Whip to tell us what he proposes to do in view of the announcement made some time ago that the Government intend us to meet at ten o'clock tonight to discuss the Bill? This means that, after this all-night sitting, we shall have another all-night sitting tomorrow night, followed by the Wednesday morning sitting.

Is it possible, Mr. Deputy Speaker, to have an opportunity to move the suspension of the Sessional Order to prevent our having to sit on Wednesday morning?

I notice that we are to consider a Motion on the Civil Defence (Casualty Services) Regulations, and I should imagine that by the time we arrive at that stage we will need the use of casualty services. We are also to discuss a Motion on the Civil Defence (Public Protection) Regulations for England and Wales and for Scotland, and we will certainly need public protection by that time. I would imagine that the Control—

Mr. Deputy Speaker (Mr. Sydney Irving)

Order. I am afraid the hon. Member cannot intervene in this way with this proposition in the middle of the Bill. Mr. Fletcher-Cooke.

Mr. Lewis

Further to that point of order. I do not want to prolong the matter, but we have had a pronouncement—

Mr. Deputy Speaker

Order. I am not suggesting that the hon. Gentleman may no wish to raise this matter. There may he a more appropriate time when he will wish to discuss the matter in a Business statement with the Leader of the House—

Hon. Members

Where is he?

Mr. Deputy Speaker

Order. Mr. Fletcher-Cooke.

Sir J. Eden

On a point of order, Mr. Deputy Speaker. Before we can proceed any further, we ought to have the Leader of the House here. Where is he? Why dos he not come here?

Mr. Deputy Speaker

Order. I am afraid that that is not a point of order for the Chair. I understand the anxiety the House has to make progress: perhaps it would be better if there were not interventions. Mr. Fletcher-Cooke.

Mr. Kenneth Lewis

Further to that point of order—

Mr. Deputy Speaker

Order. I adjudicated that that was not a point of order. The hon. Member therefore cannot further raise it. Mr. Fletcher-Cooke.