HC Deb 15 March 1967 vol 743 cc645-70

10.25 p.m.

Mr. Terence L. Higgins (Worthing) rose—

Mr. Charles Fletcher-Cooke

On a point of order, Mr. Speaker. I understand that we are now to discuss Statutory Instrument No. 106, made under the Prices and Incomes Act. This Order concerns, and concerns only, the persons employed by Joseph Bourne and Son Ltd., and only those who are employed at the Denby Pottery in Derby, a very limited concern and, I should have thought, a very private concern. Surely on principle it is right that our procedure should be such that those private persons should have a chance of being heard either in person or by counsel under the traditional procedures of this House since this does not affect the body of the citizens as a whole but a very small and very particular number of persons.

For that reason, is it right that this debate should be compressed into a matter of an hour whereas these people who are alone concerned by this Order have no opportunity of being heard?

Mr. Speaker

I am afraid this is a point of argument and a point of difference between the hon. and learned Member and the Government. It is by no means a point of order. Mr. Higgins.

Mr. Higgins

I beg to move,

That the Temporary Restrictions on Pay Increases (20th July 1966 Levels) (No. 2) Order 1967 (S.I., 1967, No. 106), dated 1st February 1967, a copy of which was laid before this House on 1st February, relating to employees of Joseph Bourne and Son. Ltd. at the Denby Pottery, Derby, be withdrawn. This Motion is concerned with yet another Prices and Incomes Order which the Government have made as part of their compulsory prices and incomes policy. Throughout the debates which have taken place on the Prices and Incomes Act and the Orders which have arisen under it, we on this side of the House have made plain that we are totally opposed to the Government's use of compulsion and, in particular, the element of discrimination and intimidation involved. For this reason, the House may well sympathise with the point made by my hon. and learned Friend the Member for Darwen (Mr. Fletcher-Cooke) that this particular Order discriminates against a very small group.

It has been typical of all the Orders we have debated under the Act that they tend to discriminate against very small groups. The smallest, I think, consisted of two people. Therefore, it is right and proper that we should oppose the element of compulsion, intimidation and discrimination which this Order involves. I hope that my hon. Friends will join with me in dividing the House on this matter.

It is very important to place this Order in the context of the current economic environment. Following the severely deflationary measures of last July, which were necessitated by the Government's failure to take action earlier, the Government's stance on incomes policy is no longer what it was in the heyday of the Declaration of Intent, that of King Canute trying to hold back a flood of wage claims and price increases. Rather it seems to me that King Canute is now swimming parallel to the shore under the impression that he is being saved by a compulsory lifebelt when the reality of the situation is that the economic tide has ebbed and the compulsory lifebelt is not doing anything to help.

Mr. Speaker

The hon. Member will come to the Order, I hope.

Mr. Higgins

Yes, I was endeavouring to demonstrate that compulsory Orders of this kind are not necessary.

Mr. Speaker

It is only this one that we are concerned with.

Mr. Higgins

Indeed, this particular Order would not be necessary when the Government had taken deflationary measures which, in any case, would prevent the granting of inflationary wage claims. The fact of the matter is, of course, that it is quite impossible to tell from what the Government say whether they really believe that the stabilisation of wages over the last six months has been due to compulsion or due to deflation, and this is something which we certainly failed to establish through Questions related to this very point only yesterday.

I want to turn first of all to a point which came up in an earlier debate on a similar Order and the position of the Prices and Incomes Board, because it seems to me that in considering this Order also the Prices and Incomes Board is far from irrelevant. The Joint Parliamentary Secretary to the Ministry of Labour, in the debate on the limb-fitters' case, said: The Government are committed to and bound by whatever recommendation the Board may make."—[OFFICIAL REPORT, 7th March, 1967; Vol. 742, c. 1423.] I hope that he will clarify, on this Order, whether people in the position in which some may regard those affected by this Order to be that of "low-paid workers" have any option as to whether a report is made by the Board.

It would appear that the Board's recommendations are being accepted as binding by the Government. This certainly was the implication of what the hon. Gentleman said on the earlier occasion. If this is so I think it is right that the House should know whether these reports are to be accepted automatically in each case—this would seem to us a dangerous infringement on the powers of this House—or, if they are not to be accepted automatically, whether the Government will give us the criteria on which they decide to accept the recommendations, or not.

I want to turn now to the particular history of this case within the framework which I have outlined. The history really begins with a pay increase which was claimed by some 550 employees of Joseph Bourne and Son Limited. This firm is one of the largest employers in the small, specialised stoneware industry, The pay and conditions of the 1,500 workers in this industry are controlled by the National Joint Wages Board for the stoneware industry. It is important to remember that such a wages board is not the same thing as a wages council, which is, of course, a statutory body set up to ensure that low-paid workers do receive adequate remuneration. The National Joint Wages Board we are concerned with here is a voluntary body, and there is not a Ministry of Labour inspector.

None the less, I think it would be interesting for the House to know whether the Joint Parliamentary Secretary feels that the people who are covered by the Order which we are now discussing should or should not be regarded as "lowest paid workers" within the terms of the various Prices and Incomes White Papers.

The minimum rate of pay in the industry before the wages increase which we are now discussing was something like £10 10s. 1½d. a week. The average earnings have been variously estimated. I understand the Joint Parliamentary Secretary's colleague, the Chancellor of the Duchy of Lancaster, estimated them to be some £18 15s. whereas the Minister himself estimated them to be £17. I hope that the hon. Gentleman will clarify this. At all events, the basic wage even the average earnings, are below the national average of £20 6s. We should be grateful, therefore, if the hon. Gentleman would tell us whether he thinks that these people are "lowest paid workers" within the meaning of the Act, or not.

On 22nd June the Wages Board agreed to an increase of 15s. 6d. on the basic rates, to be payable from 15th August, which is one of the crucial dates in this matter, and a reduction of hours from 41 to 40 per week from 3rd April this year.

On 5th August, the employers' association told the unions that the increase would be deferred for six months in accordance with the standstill on prices and incomes. The employees in other firms accepted this postponement and they have in fact received the increase from 15th February, this year, six months after the original proposed increase, in other words, the normal six months' deferment which the Government's prices and incomes policy involves.

However, the main union involved with the 550 workers refused to accept this deferment and one of its members, a Mr. Morris, employed by Bourne and Son, brought a test case and issued a summons for breach of contract. At this stage, the firm gave written notice, under Part IV which was invoked, as the House will recall, on 6th October, that the increase would be postponed, and it claimed that while it was liable for payment of the increase from 15th August to 5th October it was not liable from 6th October. The situation at this point was that the firm felt that it was protected by Section 30 of the Prices and Incomes Act.

On 21st October, a judgment was given for Mr. Morris in which the judge held that the rates of remuneration before 6th October were the increased amount, even though in fact that amount had not been paid. The firm decided to accept the judgment and not to appeal. I should like the Parliamentary Secretary to clarify whether that sum of money for the intervening time has been paid. I hope that he will enlighten the House about that.

Of course, the fact that this individual had secured a court decision jeopardised to some extent the position of the firm and of the Government, because other people could have obtained similar judgments. So, on 13th January the Government gave notice of intention to make the Order, which we are now debating, to forbid the firm from paying the increase from the date of the Order's coming into force. Despite discussions, they failed to reach agreement on a voluntary arrangement and the Order was therefore made and brought into force on 2nd February.

At this point, it is relevant to consider the Government's attitude. In a Press release they said that the Government's intention in making the Order was that employees of Denby Pottery should be no better off, as a result of the award at Derby County Court in December, than were other workers in the stoneware pottery industry and in other industries whose pay has been deferred in accordance with the standstill". This is the declared intention of the Government in this matter.

As with all such Orders which we have debated, some very important points of principle arise. The first is not that which arose with the police draftsmen when there was a question of whether the issue was sub judice. This one is similar to the Thorn case, because the Government are seeking to overrule a court decision confirming that a group of workers were entitled to receive a pay increase. We on this side of the House regard that as deplorable, because when an agreement is freely entered into by both sides in a firm, we think that it is right and proper that that agreement should be kept, particularly so when its validity has been specifically upheld by a court decision.

The second point of principle concerns the quotation which I have just read from the Government's Press statement. The House will recall that in some other cases, for example, that of the draftsmen, the Government have sought, when someone has actually managed to secure an increase to which the Government have thought they were not entitled, to grab back the increase and obtain re-imbursement. It appears that there is some inconsistency between that and the position which the Government are now adopting, when this Order merely seeks to restore equality between these covered by the Order and other workers in the industry. However, this is not entirely clear and I hope that the Parliamentary Secretary will clarify this, too.

As I understand it, what the Government are now doing is to impose a freeze on those who have managed to obtain the pay increase, under a court order, for six months. This will be a different six months to the period for which the other workers in the industry had their pay frozen. The question arises: are the Government merely going to freeze both groups for six months. The people who did not get the increase because they volunteered to abide by the Government's policy, and the people who refused to volunteer and who are now forced to have their increase deferred, or will those who are covered by this Order have their pay frozen for rather more than six months, so that the remuneration which they receive in the interim period is effectively paid back as well?

This is an important point of principle, and one which I hope that the Parliamentary Secretary will clarify. The question also arises as to what is the position about the second part of the pay agreement, which was authorised by the Wages Board? What is the position about the reduction in the working week from 41 hours to 40, which is due to come into effect on 3rd April? Is this to be frozen, or will the workers have the benefit of this. Are all the workers in the industry to get it, or only those who have been affected by this Order?

I want to anticipate an argument which the hon. Gentleman may use. We have, on a number of occasions, heard of pleas for the universality, or the comprehensiveness of the Government's incomes policy. I should not be surprised if the hon. Gentleman were to say that it was essential to freeze the pay of these 550 workers because, otherwise, it would be unfair to the other 1,000 or so workers in the industry who had volunteered to abide by the Government's decision.

This would be a valid argument, if the Government could reasonably say that the group covered by this Order were the only group receiving a pay increase. The House knows that this is not so, and is well aware that the idea that the Government's incomes policy is universal is a myth. I hope that if the hon. Gentleman puts forward this argument tonight, he will first of all tell us what percentage of the total labour force is represented by trade unions and what percentage of all wage and salary earners are covered by existing statistics. As my hon. Friend the Member for Oswestry (Mr. Biffen) is frequently keen to point out, we cannot believe in the Government's incomes policy if they simply do not have the statistics to show that it is justified.

Mr. Speaker

Order. If the hon. Gentleman responds to the invitation he will be out of order.

Mr. Higgins

I was pointing out that the argument which we constantly get for this and similar Orders is that it is in some sense a universal policy, covering everyone, and if one group of people got out of line the Government are ready to put an Order on it. The point I am trying to make is that it simply is not true that the Government's policy is universal. It is a myth to suppose that is, and I am challenging the hon. Gentleman to show that he even knows what wage increases have taken place. I would suggest, with the greatest respect, that this is extremely relevant to the Order. Similarly, we might reasonably ask the hon. Gentleman which group of people in the period of freeze, secured increases inconsistent with the wages policy.

Mr. Speaker

Order. Again with respect, the request for statistics and for information about other groups, are completely outwith this Order.

Mr. Higgins

I naturally bow to your Ruling and will proceed with my peroration. I do not want to dwell on the disillusionment with the present Government which is evidently rife in the National Society of Pottery Workers, still less on the fact that it may have felt obliged no longer to support the party which this Government represent. I do not want to do this because I think it would give credence to the view that by imposing this Order the Government like this are in some sense being tough with the unions in a broad sense. I think it is clear that what the Government are doing is not being tough with the unions in any broad sense. What they are doing is taking a big stick against individuals, and against individual unions. This is what they are doing.

They are really attacking the whole basis of free collective bargaining, the whole basis that contracts shall be entered into freely by both sides of idustry, and that these contracts shall be honoured by those who have entered into them. They are striking at the base of industrial relations in this country by introducing the element of compulsion which they have, and it is for this reason that I hope my hon. Friends will join me in the Division Lobby tonight.

10.46 p.m.

Mr. John Biffen (Oswestry)

My hon. Friend the Member for Worthing (Mr. Higgins) has outlined the history of this rather sad case, and I fully endorse the charges which he has laid against hon. Gentlemen opposite.

I should like to confine myself to three relatively small points which arise from this Order, and I hope that the Joint Parliamentary Secretary will seek to assure me on them. The first comes under the Schedule, where there is a reference to Joseph Bourne and Son Limited. The point of particular significance about Joseph Bourne and Son Limited is that under the provisions of the 1965 Finance Act it is a close company. I assured myself of this fact by telephoning the company this afternoon and speaking to one of the executives.

As a result of accepting this Order, and not successfully praying against it, the profits of the company will rise by the amount of wages which it will not have to pay, and a pre-determined share of that increase in its profits will have to go in increased dividends. This has been fully accepted by the Government when pressed on this point from both sides of the House, and this is something which everyone concerned with the supposed equity of the prices and incomes policy should bear in mind on this Order, because it concerns a close company.

My second point arises from the remarks made by my hon. Friend. The Department of Economic Affairs made a Press release on this issue and said: The Government's intention in making the Order is that the employees of Denby Pottery should be no better off, as a result of the award at Derby County Court in December, than other workers in the stoneware pottery industry"— and then comes what seems to be the relevant phrase— and any other industries whose pay has been deferred in accordance with the standstill. This again presumes that there is almost universal concurrence with the prices and incomes policy, and that a few anti-social people are thought to be infringing it.

But this is the myth world in which the Ministry of Labour operates. Nobody else believes this, and surely even the credulity of the Joint Parliamentary Secretary must be a little strained on this point, because it is not a question of straying into the realms of order about statistics. It is a question of reminding the hon. Gentleman that the Association of Supervisory Staffs Executives and Technicians has boasted of 41 instances in which it has infringed the standstill and severe restraint.

In generosity, I taxed the Joint Parliamentary Secretary on this point. I asked him what was to be done about it so that one could have a consistency of action and the people whose wages we are now discussing could see that everyone else was in the same cart—a sort of fair shares of misery. The Joint Parliamentary Secretary said: I am not proposing to pursue these anonymous cases."—[OFFICIAL REPORT, 13th March, 1967; Vol. 743, c. 6.] I can only say that the crime is visibility. If people can be easily identified, as the workers in this instance could be, they will reap the full rigours of Government action.

Why were these workers so easily identified? It was because they had recourse to a court of law. It is an extraordinary progress in the concern of this House for the conditions of employees that workers should incur the wrath of Par- liament because they go to the courts of law, when we know, not only from the answers of the Joint Parliamentary Secretary but from our own observations in our constituencies, that there are many instances of people getting increases every month, such as were sought, and successfully sought, by the 150 workers at Joseph Bourne and Son Limited.

My last point conerns, again, the fair shares in misery, because as a result of this Order the workers at Joseph Bourne and Son Limited will take a six months' freeze which will cover a period different from that of other workers in the stoneware pottery industry. I think I am correct in saying that the freeze for the other workers ran from roughly last August until February of this year—I see that the Parliamentary Secretary confirms that view. So, by way of compensation, the workers at Joseph Bourne and Son Limited will have their wages frozen from February, presumably, until six months later. The Parliamentary Secretary has not confirmed that view, but I presume that what I have said is correct.

There is no guarantee of equality of treatment at all. Other things are not equal, and the most unequal factor in this situation is that we have in prospect the Budget, which could easily change tax rates and thereby totally alter the actual take-home pay, even though the proposal is that the workers at Joseph Bourne and Son Limited should be put on the same footing as other workers in the stoneware pottery industry. It is merely an act of faith. The Joint Parliamentary Secretary does not know what is in the Budget, and even if he did he could not tell us this evening.

I therefore come to the conclusion that the Order is the product of bumbling bureaucracy. It is quite unnecessary. I cannot believe that the Government's economic policy is so much in jeopardy that it requires this kind of Order. It is high time the Parliamentary Secretary allowed a little sunshine into his soul. If he were to accept our Motion he would be showing respect for the law and allowing the worker to be worthy of his hire. I hope that, on full consideration of these arguments and those of my hon. Friend the Member for Worthing, we will have the unprecedented example this evening of the House of Commons actually triumphing over the Executive.

10.54 p.m.

Mr. Stan Newens (Epping)

I do not wish to delay the House for very long, but I think it appropriate that an hon. Member on this side should speak on this Order. As I understood the Government's prices and incomes policy, it had as one of its objectives the giving of justice to the lower-paid workers. Nobody can maintain that the workers whom we are now discussing are other than lower paid. Pottery workers are not greedy workers, and this firm's workers are not in a very lucrative position when one considers that of employees all over the country.

The Pottery Workers Society is certainly one of the most conciliatory trade unions. It has no record of bitter strikes, and there is no history—at least in this century—of turbulent industrial relations. In fact labour relations in general have been characterised by very considerable restraint over a good number of years by the pottery workers' leaders.

I lived in the Potteries for a number of years and got to know many pottery workers very well, although I do not know the firm with which this Order is concerned. But I know that pottery workers are extremely industrious men and extremely willing in the work they are prepared to do.

It is quite unjust that they should be singled out on this occasion for the sort of treatment which they are receiving here. As has already been pointed out, very few workers are involved, but at the same time these few workers are to be crushed by Government action and are to be subjected to our action in the House this evening. At the same time, having said all these things, I want to make it quite clear that I can give no support to many of the arguments put forward by the Opposition, because I consider that hon. Members opposite are only too keen to exploit this issue for crude political purposes.

The pottery workers, like most lower-paid workers, do not owe very much to the Opposition, and although it is delightful at this stage to see the sudden twinge of conscience which seems to have swept through many of the ranks opposite, I feel that that attitude may well disappear in other circumstances. I only wish that we had had on other occasions the spectacle of the Opposition lamenting—

Mr. Speaker

Order. What we have had on other occasions is outside this Order.

Mr. Newens

At the same time, having made these points, I still am in the position in which I feel I am quite unable to support the Government in the Division Lobbies this evening, and it is not merely on this Order that I take this point of view. I took it in connection with other Orders of the same variety, and I consider that my action this evening is consistent with the point of view which I, and a number of my hon. Friends have expressed throughout the many debates we have had on the Government's prices and incomes policy.

It seems to me that this Order illustrates very clearly the flaws which exist in the Government's policy with regard to prices and incomes and I cannot believe, despite reconsidering this matter very carefully, that it is right to make this section of workers an example in the cause of seeking to put the country's economy on a firm footing. As has already been said, other workers are receiving increases, and many workers are getting away with considerably bigger increases than those which we are considering in the case of the pottery workers covered by the terms of this Order.

I consider that the Order is unjust in the extreme, and it is creating a very strong sense of injustice among the type of workers who are likely to be affected by this policy. We all know very well that prices have risen and many people are being obliged to face these ever-increasing prices on the same incomes. They certainly are not happy about doing this while they see that other people, for some reason or another, have not been obliged to accept the restraint which has been imposed upon them. In these circumstances I appeal to my hon. Friend to review his attitude very carefully before he kinds up the debate.

Even if nothing is done on this occasion, I hope that the Government will keep in view the spectacle of being obliged to place the burden of trying to put the country's economy right on small groups of lower-paid workers in this way. It is totally unjust. I do not believe that it has anything to do with the Socialism of which I am proud to be an advocate. In these circumstances, I repeat that I shall be unable to support the Government in the Division Lobby.

11.1 p.m.

Mr. F. A. Burden (Gillingham)

The hon. Member for Epping (Mr. Newens) has made an extraordinarily interesting speech. I believe that it arose from long association with the Potteries. Indeed, one is led to wonder what would have happened had he been representing a constituency from that area. He might well have come into the Lobby with the Opposition.

Mr. Newens indicated dissent.

Mr. Burden

At least, had it not been for this Motion, he would not have been able to voice his remarks, which I hope the Joint Parliamentary Secretary to the Ministry of Labour will take to heart.

The Order penalises 150 workers of a firm in the Potteries. It denies to them wage increases agreed to with the firm. The contract had been properly made. As my hon. Friend the Member for Oswestry (Mr. Biffen) pointed out, this being a close company the money saved as a result of non-payment of these increases will now go out in increased dividends.

I remind the Joint Parliamentary Secretary that these are lower-paid workers. The minimum wage is £10 10s. 5½d. a week, rising, presumably with full overtime, to £18 15s. [Interruption.] I wish that my hon. Friend the Member for Ormskirk (Sir D. Glover) would restrain himself until called by Mr. Speaker.

Sir Douglas Glover (Ormskirk)

I was just saying to my hon. Friend the Member for Oswestry (Mr. Biffen) that his was a jolly good speech—better than the one which my hon. Friend the Member for Gillingham (Mr. Burden) is making.

Mr. Speaker

Order. I hope that we can get on without interruptions.

Mr. Burden

What my hon. Friend the Member for Ormskirk says may well be so. Although I may not speak as well as my hon. Friend the Member for Oswestry (Mr. Biffen), at least I do not make speeches as often as he does.

Mr. Speaker

Order. I hope that we can now get back from these pleasantries to the Order.

Mr. Burden

My hon. Friend the Member for Ormskirk did rather call for comment, Mr. Speaker.

I want to ask the Joint Parliamentary Secretary what wage increases had been agreed to in this case. How much and to what extent would these workers have benefited? This is very important. We should know what increases are being denied to them. The information would indicate to what extent they were going outside the incomes policy.

Certain firms are being caught and their workers are having wage increases denied to them. Not a great number of Orders like this are being laid denying workers in particular firms wage increases agreed between them and their employers, but in how many cases are wage increases being given by small firms which are not known by the Minister? What happens to these people? They get their wage increases. It is impossible for the Ministry to impose a wage freeze throughout industry, especially where workers may not belong to a trade union. I should like to ask the Parliamentary Secretary how many more likely cases there are in the pipeline on which Orders will come before the House.

Mr. Speaker

The Minister is not able to answer that. It would not be in order as he must keep to this Order.

Mr. Burden

I should like to know from the Joint Parliamentary Secretary what amount of the output of this firm goes to exports. Exporting is one of the things we want to encourage and surely workers in factories which do a considerable amount of export business should be encouraged to work even harder and give us greater output and production to help us put the balance of payments and the overseas trade balance right. The export performance of this firm is important, because the workers, having been denied this increase, if they have been engaged in a big export drive, will not be encouraged to continue and we may have falling rather than rising production. One of the worst features of the Government's attitude is represented by some of the niggling little actions they are taking by means of Orders like this one.

I hope that we will be told by the Joint Parliamentary Secretary that as a result of the timing of this Order the workers in this factory will not in the end suffer in comparison with others in the industry when their time comes to get an increase.

11.8 p.m.

Mr. Charles Fletcher-Cooke (Darwen)

May I ask a short question about the effect of this Order?

In the relevant Section of the principal Act the effect of the Order is that the employer shall not pay the increases in wages involved while the Order is in force. The Order presumably falls when Part IV of the Act expires. When that happens does the obligation under the order of the court revive?

Is the employer then, under the order of the court, obliged to pay what the court ordered? If so employers are presumably not obliged to declare a dividend, as was so ably pointed out by my hon. Friend the Member for Oswestry (Mr. Biffen). If not, presumably they are obliged under the relevant Finance Acts to increase the dividends thereby. Surely they are entitled to know what their obligations are as regards this money when August arrives and Part IV disappears. Is the obligation not to pay a temporary one during the force of the Order or does it remain for ever and a day?

11.9 p.m.

Sir Douglas Glover (Ormskirk)

May I start by apologising to my hon. Friend the Member for Gillingham (Mr. Burden)? I know how upsetting it is when another hon. Member intervenes or speaks during one's speech. I think that I was charged with a good deal more than I was responsible for, because there was a lot of talking going on behind me. I interjected for only a short period. Having got the record straight, I will go on.

This debate concerns one of the most important constitutional problems that any Parliament can consider, namely, the freedom and the rights of the individual. Benjamin Franklin, if I may misquote him, said that those who give up freedom to solve a little temporary difficulty are worthy of neither freedom nor independence. This is what the Government are doing. They are producing machinery which is the total negation of everything that the Tolpuddle martyrs and all the others who built up the independence and freedom of the working community stood for.

The Order is entirely arbitrary. My hon. Friends the Members for Oswestry (Mr. Biffen) and for Worthing (Mr. Higgins) made it clear that this is not all-embracing machinery. All of us know of case after case where wage and salary increases have taken place by the expedient of moving people from one position to another. The Government seem to have adopted an unfortunate attitude in all the Orders we have debated. This is another classic example. They seem never to deal with 1,200 people. They seem always to deal with two or 20 or 50 or, in this case, 150.

How much of this firm's output goes in exports? What is the increase or reduction in the firm's productivity? In other words, is this wage increase justified on the firm's increased efficiency? If so, that increase is in the national interest and is not an on-cost on to our national efficiency. If these workers, with the help of the management, have increased their production and their efficiency, they are entitled to a wage increase. Have these aspects been considered?

This company has gone to law. The House is dealing with a law which is superior to all other laws. Despite the fact that the court has said that a certain course of action shall be carried out, by the Order the Government say that that action shall not be carried out. I am sorry that the Joint Parliamentary Secretary shakes his head. What I have said is true. This is why these Orders come before the House. This is why we are having this debate. This makes nonsense of the courts and of the whole legal system. The longer this practice continues the greater the disrepute which will be created.

This is the first Order of this type which affects a close company. What argument can the Government advance to these workers to justify this action, because the workers know that under the Socialist Finance Act money to the tune of the wages of which they are being deprived will, to the extent of 60 per cent., have to be paid to the shareholders in increased dividends.

Mr. Robert Sheldon (Ashton-under-Lyne)

It is a pity that three hon. Members who sat through at least part of the discussion on the Finance Act have so far tried to misrepresent the workings of that Act because it was then explained that any distribution made must be such as to show that the company has no plans for investment, either now or in the future.

Sir D. Glover

I am very grateful to the hon. Member for that intervention, but the company is apparently in the position that anything it does to increase its efficiency will be counterbalanced by the action of the Government. If it increases its efficiency, it will now get no benefit for having done so, although it is a valid argument that this money will be used for investment. With the Government's present proposals, under which there is a lower rate of productive output, and investment is dropping by 10 per cent. in private industry next year according to reliable estimates, there is surely not a very strong argument to support the claim that this extra money, filched from the pockets of the workers, will be used to invest in the factories and so on, but will be used for the purpose of increased dividends.

It is not really fair to blame the Joint Parliamentary Secretary. He is not responsible, but what is he going to say? At least let us get away from the miasma which surrounds this whole subject. We are not dealing here with digits, but with human beings going home to talk to their families, to talk to their wives and children. To those people the Government are saying, "You have produced an efficient result and you deserve an increase in pay, but you cannot have it. The company has increased its dividends, and now you see the wife of the managing director driving around in the third motor car." How can the Minister justify that to the workers? The Government are virtually forcing the company to pay an increased dividend. I hope that the Joint Parliamentary Secretary will produce some satisfactory answer to this great and important question.

11.18 p.m.

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

Winding up in a debate which has largely consisted of questions which have been ruled out of order imposes a difficulty on any Parliamentary Secretary, but, within the rules of order, I want to make two comments on the speech of the hon. Member for Worthing (Mr. Higgins).

The hon. Gentleman asked if this Order—and, by implication, I take it that the seven other Orders against which Prayers have been laid in this House are also included—is relevant to Government economic policy. He asked if the wage policy over the last six months was a policy of deflation or of compulsion. He posed his antithesis, but it was a false antithesis. The economic recovery in which we are engaged is, in part, a result of those deflationary measures which were announced by the Prime Minister last July. At the same time, wage restraint is an essential part of the process, but that is very different from compulsion.

Some hon. Members opposite seem to think that the only way in which wages can be held in line with the two White Papers on the standstill and the period of severe restraint is by what they call compulsion. In fact, most wage stability has come from the voluntary acceptance of the standstill and severe restraint.

Mr. Speaker

Order. I have kept other hon. Members to the Order. The Parliamentary Secretary must keep to the Order. We cannot widen the debate.

Mr. Hattersley

I am much obliged, Mr. Speaker. I shall, if I may, leave that point and turn to the specific matter before us. [Laughter.] I understand that it is "must", not "shall" or "may".

I want to deal with four points which have been raised, all of which are central and germane to the argument. I accept the chronology as outlined by the hon. Member for Worthing. The facts as he stated them are correct. Some time before 20th July, the union and the employers came to an agreement both on the date when the settlement would come into operation and the amount which should be given, the amount being rather less than 5 per cent. of the basic wage.

Under the terms of the Government's prices and incomes policy and the standstill and severe restraint White Papers, the union was entitled to receive that increase six months after the original operative date. That is to say, they were entitled to receive it not on 15th August but on 15th February. The basic argument is about whether the Government were right in insisting to one section of the union and one firm in the Federation that the six months' postponement should be put into effect.

The first question which the Government then asked themselves, and which they were required to ask, was whether these workers were entitled under the prices and incomes policy to some preference because they were "lowest-paid workers". I emphasise that paragraph 28 of the severe restraint White Paper, Cmnd. 3150, talks about that, about "lowest-paid workers", not about "low-paid workers" or "lower-paid workers." If the Government had promised special concessions to lower-paid workers it might be argued that people earning less than the national average came into that classification. But the Government's policy is quite specific: it talks about the "lowest-paid workers".

Mr. Burden

How does one determine who is the lowest-paid worker, in which industries, in what trades, and would it apply to everyone in every trade who is found to be the lowest-paid in the trade?

Mr. Hattersley

If the hon. Gentleman will contain himself for a moment, I shall come to just that definition.

The Government, naturally and properly, considered whether the members of this union employed at this firm were lowest-paid workers. I emphasise that that consideration was done by the Government. The union and the men themselves never applied for special consideration under that aspect of the prices and incomes policy. Until the union discussed their position with my right hon. Friend the Chancellor of the Duchy of Lancaster and myself on 31st January, the idea that they were among the lowest-paid workers in the country was never in their minds. The consideration was done by the Government. It was certainly not done by the men.

The Government are, of course, guided in their decisions about where one of the lowest-paid workers is to be found by several criteria, the criteria laid down by the Prices and Incomes Board. There are two special and specific examples. The board, talking about employees in agriculture, diagnosed them as lowest-paid workers because their hourly rate was about 5s. 9d. an hour. Talking about workers in the retail drapery trade, the board had reservations on whether they were lowest-paid workers because their pay was 7s. 11d. an hour. In fact, the average pay of workers in Joseph Bourne and Son is the same, 7s. 11d. an hour. Therefore, if we are to rely on the judgment of the Prices and Incomes Board in those two specific examples to which it turned its mind in considering who are lowest-paid workers, the workers at this factory do not qualify.

Many other criteria have been laid down from time to time.

Mr. Thomas Swain (Derbyshire, North-East)

Will my hon. Friend, as a responsible Minister of the Crown, tell us what is a lower-paid worker? [HON. MEMBERS: "Lowest."]

Mr. Hattersley

I have explained to the House, I hope, that our task is to decide not what a lower-paid worker is but what a lowest-paid worker is. I have been telling the House that the Government are properly guided in these matters by the Prices and Incomes Board. They have other advice as well, to which my hon. Friend may listen with a more sympathetic ear—from the General Secretary of the largest union in the country, Mr. Frank Cousins, who says that the lowest-paid worker is someone who earns £15 a week or less.

The workers of this factory earned an average of £18 17s. 5d. a week in the summer when earnings were high because of overtime. In the winter months, when the earnings were slightly less because overtime was slightly less, they earned an average of £17 9s. 6d. a week. By the perhaps exacting standards of Mr. Cousins they do not qualify as lowest-paid workers.

Mr. Michael Alison (Barkston Ash)

When all the lowest-paid workers have been brought up to the level of the lower-paid workers, do the lower-paid workers then become the lowest?

Mr. Hattersley

The answer is perfectly straightforward, which I think is more than one can say for the question. When the lowest-paid workers have received additional remuneration another set of lowest-paid workers take their place at the head of the queue. That is something to do with redistribution, which this party was formed to bring about.

The hon. Member for Worthing also asked how long the Order was to remain in force. He knows very well that the majority of the workers in this industry who voluntarily accepted the freeze were denied—if that is the right word—the pay increase for six months. I cannot give him or the union any very specific assurance about the date on which the Order will cease to be in force. Of course, it lapses on 11th August, when Part IV of the Prices and Incomes Act lapses, but my right hon. Friend is entitled under the Act to alter the Order, to withdraw it in part or in full if he chooses to do so in writing. It is not possible at this time to anticipate his decision.

It is possible to say that the other part of the agreement entered into by the union for implementation in April, the reduction in the working hours from 41 to 40 a week, will go forward. It is in no way part of the task of my right hon. Friend or my Ministry somehow to penalise the union or jeopardise their agreement to have a reduced working week. That is part of the agreement that can go on irrespective of the prices and incomes policy, and our agreement will be given for the reduction to go forward on 3rd April.

Mr. Higgins

If it is the Government's intention in making the Order, as they say, that the employees of the Denby Pottery should be no better off as a result of the award at the Derby County Court in December, than were the other workers in the stoneware and pottery industries, whose pay increases were deferred in accordance with the standstill, surely it is a matter of simple arithmetic to determine what the freeze period will be. Why will the hon. Gentleman not give it?

Mr. Hattersley

Simple arithmetic suggests that it would lapse on 2nd August, but it is not my right hon. Friend's policy to announce what his decision will be on that date. It is within his jurisdiction, and an announcement is likely to be made nearer the time.

Although this debate need not necessarily end at half-past eleven, I do not want to detain the House longer than necessary.

Three points were made by the hon. Member for Oswestry. The first was extraordinary, and one on which he may want to intervene and make a correction when I remind him of what happened the day before yesterday. He talked, as he has talked constantly over the last month, about firms and unions and individuals who, according to him, are ignoring the freeze and are breaking the line, and who are driving a coach and horses through the Government policy.

He quoted a written Answer I gave him on Monday, referring to a publication of my own trade union, which claimed that there were cases where it had already defied the freeze. He said that I replied: I am not proposing to pursue these anonymous cases."—[OFFICIAL REPORT, 13th March, 1967; Vol. 743, c. 6.] But in fact my Answer went on to say that many of them were in any case in conformity with the prices and incomes policy.

It is not good enough—

Mr. Biffen

Since the Joint Parliamentary Secretary has invited me to intervene, I gladly do so. He says, "many of them". How many are in conformity and how many are not?

Mr. Speaker

Order. We are getting away from the Order.

Mr. Hattersley

The second point that the hon. Gentleman made—I absolve him from the accusation of pursuing this for crude political purposes knowing that he is pursuing it because of a theological zeal for free enterprise, which obsesses him every Tuesday night—was that since the firm was no longer required to pay the increase in wages it would automatically, because of its close company status, translate it into greater profits, distributed or undistributed. What an extraordinary philosophy of industry! Has he not heard of reduced prices?

Hon. Gentlemen opposite ask about the export record of the firm. I am happy to say that it is a remarkable one; it is second to none in the industry. One of the reasons why the wage increases have been blocked by the Government is to keep the firm in that competitive position to enable it to sell abroad. [HON. MEMBERS: "Oh!"] One of the purposes of the incomes policy stipulated in both White Papers is to make sure that such a firm goes on with such an admirable export record.

Mr. Biffen

What we know is that the wage increase has been blocked. The hon. Gentleman talks about the possibility of prices being reduced. Can he tell the House what prices have been reduced by Joseph Bourne and Son Ltd., when, and how long the price reductions are expected to run?

Mr. Hattersley

Of course I cannot. The hon. Gentleman knows as well as I do that it is not simply a question of whether prices have been reduced. It is a question of whether they would have gone up if the increased wages had been paid. It is straightforward. He also knows that it is absurd to suggest that in some way the Government are overriding the decision of the courts. The men have been paid what the courts said they were entitled to. The hon. Gentleman asked whether the period in dispute had been cleared up, whether the wages

to which the men are entitled have gone into their pay packets. They have. What the courts said the men were entitled to has been paid to them.

What the Government have done is to say that the workers in the firm—rather fewer than 500—chose, uncharacteristically of the rest of the industry and the rest of the British working population, to break the line on incomes policy, and that the sacrifice—for sacrifice it is— that two-thirds of the industry has been prepared voluntarily to make in the interests of economic viability they should make as well.

The question that we must ask the hon. Gentleman is: If he believes in an incomes policy at all, is he saying that the Government should have an incomes policy but on occasions like this they should be prepared to turn their back on it? Is he saying that the Government should have an incomes policy but should allow people to break it? Is he saying that the Government should have an incomes policy but not for the more militant trade unions and the more determined individuals? We on the Government benches have no doubt about the answers to the questions. If there is to be an incomes policy it must be spread equally over the country and operated universally, and the Order is intended to ensure just that.

Question put:—

The House divided: Ayes 125, Noes 185.

Division No. 293.] AYES [11.34 pm.
Alison, Michael (Barkaton Ash) Errington, Sir Eric Hunt, John
Allason, James (Hemel Hempstead) Eyre, Reginald Hutchison, Michael Clark
Astor, John Farr, John Irvine, Bryant Godman (Rye)
Atkins, Humphrey (M't'n & M'd'n) Fisher, Nigel Johnston, Russell (Inverness)
Barber, Rt. Hn. Anthony Fietcher-Cooke, Charles Jopling, Michael
Batsford, Brian Fortescue, Tim Kershaw, Anthony
Berry, Hn. Anthony Gibson-Watt, David Kimball, Marcus
Biffen, John Gilmour, Sir John (Fife, E.) King, Evelyn (Dorset, S.)
Biggs-Davison, John Glover, Sir Douglas Kirk, Peter
Birch, Rt. Hn. Nigel Goodhew, Victor Knight, Mrs. Jill
Blaker, Peter Gower, Raymond Lancaster, Col. C. G.
Bossom, Sir Clive Grant, Anthony Legge-Bourke, Sir Harry
Brewis, John Grant-Ferris, R. Lubbock, Eric
Brinton, Sir Tatton Grieve, Percy MacArthur, Ian
Bromley-Davenport, Lt.-Col. Sir Walter Gurden, Harold Maclean, Sir Fitzroy
Buchanan-Smith, Alick (Angus,N&M) Hall-Davis, A. G. F. Maginnis, John E.
Burden, F. A. Hamilton, Michael (Salisbury) Maude, Angus
Carr, Rt. Hn. Robert Harris, Reader (Heston) Mawby, Ray
Clegg, Walter Hawkins, Paul Maxwell-Hyslop, R. J.
Cooke, Robert Higgins, Terence L. Maydon, Lt.-Cmdr. S. L. C.
Crawley, Aidan Hiley, Joseph Mitchell, David (Basingstoke)
Crouch, David Hill, J. E. B. Monro, Hector
Dance, James Hirst, Geoffrey More, Jasper
Davidson, James (Aberdeenshire,W.) Hobson, Rt. Hn. Sir John Morrison, Charles (Devizes)
d'Avigdor-Goldsmid, Sir Henry Hogg, Rt. Hn. Quintin Munro-Lucas-Tooth, Sir Hugh
Dean, Paul (Somerset, N.) Holland, Philip Murton, Oscar
Deedes, Rt. Hn. W. F. (Ashford) Hordem, Peter Nabarro, Sir Gerald
Doughty, Charles Howell, David (Guildford) Neave, Airey
Noble, Rt. Hn. Michael Rossi, Hugh (Hornsey) Wainwright, Richard (Colne Valley)
Onslow, Cranley Royle, Anthony Walker, Peter (Worcester)
Osborn, John (Hallam) Russell, Sir Ronald Webster, David
Page, Graham (Crosby) Scott, Nicholas Wells, John (Maidstone)
Pardoe, John Shaw, Michael (Sc'b'gh & Whitby) Whitetaw, Rt. Hn. William
Pearson, Sir Frank (Clitheroe) Smith, John Wilson, Geoffrey (Truro)
Peel, John Steel, David (Roxburgh) Winstanley, Dr. M. P.
Percival, Ian Summers, Sir Spencer Wood, Rt. Hn. Richard
Pink, R. Bonner Taylor, Edward M. (G'gow, Cathcart) Worsley, Marcus
Prior, J. M. L. Taylor, Frank (Moss Side) Wright, E.
Ramsden, Rt. Hn. James Teeling, Sir William Wylie, N. R.
Renton, Rt. Hn. Sir David Temple, John M. Younger, Hn. George
Ridley, Hn. Nicholas Thorpe, Rt. Hn. Jeremy
Ridsdale, Julian Turton, Rt. Hn. R. H. TELLERS FOR THE AYES:
Roots, William van Straubenzee, W. R. Mr. Francis Pym and
Mr. R. W. Elliott.
NOES
Albu, Austen Garrett, W. E. Ogden, Eric
Alldritt, Walter Ginsburg, David O'Malley, Brian
Allen, Scholefield Gordon Walker, Rt. Hn. P. C. Oram, Albert E.
Anderson, Donald Gourlay, Harry Oswald, Thomas
Archer, Peter Gray, Dr. Hugh (Yarmouth) Padley, Walter
Ashley, Jack Grey, Charles (Durham) Page, Derek (King's Lynn)
Bagier, Gordon A. T. Griffiths, David (Rother Valley) Palmer, Arthur
Bence, Cyril Griffiths, Rt. Hn. James (Llanetty) Parkyn, Brian (Bedford)
Benn, Rt. Hn. Anthony Wedgwood Hamilton, James (Bothwell) Pentland, Norman
Bennett, James (G'gow, Bridgeton) Hamling, William Perry, Ernest G. (Battersea, S.)
Birwis, John Hannan, William Price, Christopher (Perry Barr)
Bishop, E. S. Harper, Joseph Price, Thomas (Westhoughton)
Blackburn, F. Haseldine, Norman Price, William (Rugby)
Blenkinsop, Arthur Hattersley, Roy Probert, Arthur
Boardman, H. Healey, Rt. Hn. Denis Randall, Harry
Braddock, Mrs. E. M. Henig, Stanley Rees, Merlyn
Brooks, Edwin Hobden, Dennis (Brighton, K'town) Reynolds, G. W.
Broughton, Dr. A. D. D. Hooley, Frank Rhodes, Geoffrey
Brown, Rt. Hn. George (Belper) Houghton, Rt. Hn. Douglas Roberts, Albert (Normanton)
Brown, Bob (N'c'tle-upon-Tyne, W) Howarth, Robert (Bolton, E.) Roberts, Goronwy (Caernarvon)
Brown, R. W. (Shoreditch & F'bury) Howelt, Denis (Small Heath) Robinson,Rt.Hn.Kenneth (St. P'c'as)
Buchan, Norman Howie, W. Robinson, W. O. J. (Walth'stow, E.)
Cant, R. B. Hoy, James Ross, Rt. Hn. William
Carmichael, Neil Huckfield, L. Rowland, Christopher (Meriden)
Carter-Jones, Lewis Hughes, Roy (Newport) Rowlands, E. (Cardiff, N.)
Coe, Denis Hunter, Adam Sheldon, Robert
Coleman, Donald Hynd, John Shore, Peter (Stepney)
Concannon, J. D. Janner, Sir Barnett Short,Rt.Hn.Edward (N'c'tle-u-Tyne)
Craddock, George (Bradford, S.) Johnson, James (K'ston-on-Hull, W.) Silkin, Rt. Hn. John (Deptford)
Crawshaw, Richard Jones, J. Idwal (Wrexham) Silkm, Hn. S. C. (Dulwich)
Crossman, Rt. Hn. Richard Jones, T. A. (Rhondda West) Slater, Joseph
Dalyell, Tam Kelley, Richard Small, William
Davidson, Arthur (Accrington) Kerr, Dr. David (W'worth, Central) Snow, Julian
Davies, Dr. Ernest (Stretford) Lawson, George Spriggs, Leslie
Davies, G. Elfed (Rhondda, E.) Leadbitter, Ted Swingler, Stephen
Davies, Ifor (Gower) Lewis, Ron (Carlisle) Thornton, Ernest
Davies, Robert (Cambridge) Lomas, Kenneth Tinn, James
de Freitas, Rt. Hn. Sir Geoffrey Loughlin, Charles Tuck, Raphael
Dell, Edmund Lyon, Alexander W. (York) Urwin, T. W.
Dewar, Donald Lyons, Edward (Bradford, E.) Varley, Eric G.
Dobson, Ray McBride, Neil Wainwright, Edwin (Dearne Valley)
Doig, Peter MacColl, James Walden, Brian (All Saints)
Driberg, Tom MacDermot, Niall Walker, Harold (Doncaster)
Dunn, James A. McGuire, Michael Watkins, David (Consett)
Dunnett, Jack McKay, Mrs. Margaret Watkins, Tudor (Brecon & Radnor)
Dunwoody, Dr. John (F'th & C'b'e) Mackenzie, Gregor (Rutherglen) Wells, William (Walsall, N.)
Eadie, Alex Maclennan, Robert Whitaker, Ben
Edwards, William (Merioneth) McMillan, Tom (Glasgow, C.) White, Mrs. Eirene
Ellis, John MacPherson, Malcolm Whitlock, William
English, Michael Mahon, Peter (Preston, S.) WilKins, W. A.
Ennals, David Mahon, Simon (Bootle) Willey, Rt. Hn. Frederick
Ensor, David Mallalieu,J.P.W.(Huddersfield,E.) Williams, Clifford (Abertillery)
Evans, Albert (Islington, S.W.) Manuel, Archie Williams, Mrs Shirley (Hitchin)
Evans, Ioan L. (Birm'h'm, Yardley) Mapp, Charles Willis, George (Edinburgh, E.)
Faulds, Andrew Marsh, Rt. Hn. Richard Wilson, William (Coventry, S.)
Fernyhough, E. Maxwell, Robert Winnick, David
Fletcher, Ted (Darlington) Millan, Bruce Winterbottom, R. E.
Foley, Maurice Miller, Dr. M. S. Woodburn, Rt. Hn. A.
Forrester, John Milne, Edward (Blyth) Woof, Robert
Fowler, Gerry Moonman, Eric
Fraser, Rt. Hn. Tom (Hamilton) Morgan, Elystan (Cardiganshire) TELLERS FOR THE NOES:
Freeson, Reginald Morris, John (Aberavon) Mr. Ernest Armstrong and
Gardner, Tony Moyle, Roland Mr. Walter Harrison.