HC Deb 23 April 1968 vol 763 cc27-30
Q2. Mr. Bruce-Gardyne

asked the Prime Minister whether, in the interests of economy, he will now reabsorb the Department of Economic Affairs into the Treasury.

The Prime Minister

No, Sir. Both Departments have an important function to perform and it is a fallacy to think that amalgamation would save any significant sum of money.

Mr. Bruce-Gardyne

Now that the Department of Economic Affairs has lost the prices and incomes policy, what other purpose does it serve, apart from providing the right hon. Member for Stepney (Mr. Shore) with a car, an office and a fat salary? If the Prime Minister needs his right hon. Friend's support in the Cabinet, would it not have been more economically provided by making him Minister without Portfolio?

The Prime Minister

The short answer is that my right hon. Friend has an extremely important portfolio. It is ensuring by the co-ordination of the industrial Departments that the real resources are available to meet the requirements of the Chancellor's budgetary policy, both as regards productivity and as regards exports and import replacement. That is a very important function which could not be left in the Treasury.

Mr. Moonman

Will my right hon. Friend resist the political overtones of that supplementary question and give consideration to the qualitative analysis of other Departments on the lines recently announced for further restructuring?

The Prime Minister

I have given a great deal of thought to this, not least in the past few weeks, but it is extremely important that the sponsoring Departments should be responsible for dealing with particular industries and that the Department for Economic Affairs should be responsible for the general allocation of real resources and the co-ordination of industrial policy. That is what the present set-up means.

Mr. Thorpe

Could the Prime Minister take his preceeding answer a little further and tell us why it is that the jobs discharged by the D.E.A. cannot be discharged by the Treasury?

The Prime Minister

For the reason that I have just given. The Treasury has an extremely full-time job to do, not only general financial policy, budgetary policy, but expenditure policy and international liquidity policy. We have found over the past years that when the Treasury was also responsible for industrial co-ordination, the work of "Neddy" and the rest, that work was not done but was sacrificed to purely financial considerations.

Mr. Maudling

As I understand the Prime Minister's previous answer, the D.E.A. will in future co-ordinate the work of the other industrial Departments. Surely this is a job for the Prime Minister, not the D.E.A.?

The Prime Minister

The detailed work is a job for this Department, and this has been the position since 1964. I have felt—and recent events have rather confirmed this feeling—that the work which the D.E.A. has been doing on prices and incomes has derogated from the work it has in connection with investment and export policy and import replacement. Now it will be free to concentrate on that work.

Mr. Lipton

Is there not some case to be made out for transferring the D.E.A., if not to the Treasury, then to the Ministry of Productivity, if not now, then in the not-too-distant future?

The Prime Minister

A theoretical case can be made for all these groupings and others besides, but I am satisfied, having gone into it extremely carefully, that there is a very important job of work to be done, which will extend the fullest resources of my right hon. Friend in the Department—[Interruption.]—of Employment and Productivity. I do not think it right to add to the work of that Department the work of investment, exports and the other things that I have mentioned, which will be the function of the D.E.A.

Mr. Peyton

Does the Prime Minister recall that he took over responsibility for this Department with a great fanfare of publicity? Will he now explain why he has left it so secretly? Was his leaving meant to be a confession of failure, uncharacteristic of him?

The Prime Minister

I was not aware of any great fanfare of trumpets last August—[Interruption.]—nor of any secrecy a fortnight ago. As I explained to the House, I took on that responsibility at the time to make quite sure that both through the work of the N.E.D.C. and in other ways the Departments were adequately co-ordinated. Now I am satisfied that they will be. The hon. Gentleman will be aware of the general responsibility of the Prime Minister, as First Lord of the Treasury, for co-ordinating general economic policy, not just industrial economic policy, which is the job of that Department.

Mr. Boyd-Carpenter

Does the right hon. Gentleman recall that shortly before Easter his right hon. Friend justified the 15 per cent. increase in the staff and cost of his Department by his increasing responsibility for prices and incomes? Now that that responsibility has gone, cannot the staff go too?

The Prime Minister

It was explained to the House before Easter that the staff dealing with the prices and incomes policy had already been transferred to the Department of Employment and Productivity, and to that extent the staff is reduced. My right hon. Friend will still be responsible for some very important work on industrial development, which was never done when the right hon. Gentleman was at the Treasury.