§ Q7. Mr. Bruce-Gardyneasked the Prime Minister whether the public speech of the Chancellor of the Exchequer on television, on Tuesday, 16th January, on the economic situation, represents the policy of Her Majesty's Government.
§ The Prime MinisterYes, Sir.
§ Mr. Bruce-GardyneCan the right hon. Gentleman explain why he did not give this broadcast himself, as on similar occasions in the past? Can it be that his right hon. Friends have finally woken up to the fact that to allow him to appear on television on these occasions constitutes a threat to the£?
§ The Prime MinisterI did not quite hear the last part of that supplementary question. The hon. Gentleman seems to have missed what I said earlier about the attitude of hon. Gentlemen opposite on these matters being entertainment. I am 1142 repeatedly refusing—indeed, in respect of last night, I refused—requests to appear on television. Although there was a lot which I could have said then about the American visit, I refused to appear. I felt it right, in this situation, that my right hon. Friend, who had been invited to make a Ministerial statement, should do so, because I had made the main statement in the House of Commons.
§ Mr. AtkinsonIf we couple my right hon. Friend's last answer with his answer to Question No. Q2, may we now take it that the Government's 3½ per cent. norm relates to wage rates and not total earnings? Therefore, may we also take it that, by those two answers, he is not rejecting in advance the trade union statement which is to be discussed on 28th February?
§ The Prime MinisterI am certainly not prejudging this very important discussion of 28th February. We have already expressed our view about the meeting on 11th March, which was an historic occasion, and we look forward to an equally historic approach this time. As to Question No. Q2, the right hon. Member for Barnet (Mr. Maudling) did not ask whether the question was wage rates versus earnings; he was asking about a wage settlement versus subsequent wage drift, and I answered in that context. A wage settlement can contain a large number of ingredients, including, for example, holidays, hours and many other things.
Our answer is that the nation, in our view, in the period in question, can afford increases at the rate of 3½per cent. I said that, beyond that, there could be overtime earnings and the rest of it. I was not suggesting that every agreement based on a 3½ per cent. rate of increase is right. I certainly said—
§ Mr. Hastings rose—
§ The Prime MinisterI am being questioned on a number of different matters at this time and this is important to some hon. Members.
I certainly further said that, where we can get a productivity increase over and above, this is to be welcomed and should be regarded, of course, as acceptable.
§ Mr. HeathAs the right hon. Gentleman said, this is very important to every 1143 hon. Member. Would it be fair to summarise his position as saying that 3½per cent. in a wage settlement must include all items, with the exception of any which corresponds to a productivity increase? Would that be a fair summary of his position?
§ The Prime MinisterThat is very close to what I was saying—[Laughter.]—It is very important to get this spelled out properly. It is not a matter for humour, especially by hon. Members who do not even know what we are talking about. The right hon. Gentleman's statement was very close. I said, subject to increases in productivity, for example, by changes in working practices—that is one point —and subject to the increased possibility of overtime earnings—I stress, earnings—which will accrue as a result of greater orders abroad and greater export possibilities and subject to the increases in earnings which occur—[HON. MEMBERS: "Oh, come on."]—The right hon. Gentleman asked me a serious question and he is going to get a serious answer. This is subject, also, as I understand these matters, to the fact that when the economy was somewhat depressed last year there were limited facilities for full piece-rate earnings. These will now be increased. Therefore, it is subject to these three conditions in addition to the productivity one mentioned by the right hon. Gentleman.
§ Mr. HeathPerhaps I could put two points on that. First, is it not clear that a settlement itself would, of course, be exclusive of overtime earnings, because that can happen in any situation? Second, should there be settlements of 3½per cent. without any increase in productivity? If there is a settlement of 3½per cent., including holidays and so on, for such an increase in productivity, would that not be bound to lead to inflation?
§ The Prime MinisterThe issue is whether we are talking about national productivity or individual productivity, either in a single industry or in a single plant, where plant bargaining applies. This has been the general trend of the last year or so—particularly last year, when national productivity rose. Last year it was up more than 3½per cent., and therefore it would not be inflationary. But, obviously, any other settlement, 1144 whether on a plant or on a national industrial basis, which led to further increases in productivity related to that plant or factory could well be regarded as permitting a further increase in payments in return for that productivity, provided that the productivity is guaranteed and copper-bottomed as part of the agreement.
§ Mr. HefferIn view of the fact that my right hon. Friend has laid such great stress on productivity, how on earth could he arrive at his previous answer about the Colt engineering workers and their union, when in fact they are in the process of negotiating a productivity agreement?
§ The Prime MinisterOf course I am all in favour of that. I said in Burnley that, rather than people working an extra half-hour for nothing, to get increased productivity in normal working hours is of great benefit to the nation. I still think it wrong to discipline, by however a democratic procedure—[Interruption.] I still think it wrong to discipline, by whatever democratic procedure. those who are aiming in their own way to increase productivity. It may or may not be the wrong way. [Laughter.] This is not a matter for humour. I know that there are big differences of view among hon. Members opposite about the "Back Britain" campaign. Nevertheless, we take the view that we want increased production, particularly in working hours, and it is wrong to try to discipline anyone for trying to do that.
§ Mr. MaudlingFollowing the question asked by the hon. Member for Tottenham (Mr. Atkinson), the figure for wage rates alone is below 3½per cent.
§ The Prime MinisterWe shall be making a fuller statement to the House in due course—[Interruption.] Hon. Members who interrupt in this way are obviously totally unaware of the way in which wages are fixed in British industry. We shall be making a full statement to the House in due course. These matters are being considered. We shall want to consider particularly the outcome of the meeting of trade union executives at the end of this month, but basically the position is that we regard—[HON. MEMBERS: "Answer the question."] I answered the question, but hon. Members opposite were not listening, in a speech I made 1145 three weeks ago when dealing with this matter at great length. Hon. Members opposite were more concerned with chatting among themselves, and some of them will not understand it when they have read it. I said on that occasion that 3½per cent. must be the ceiling for all the settlements. We have to consider how that affects wage rates—in some cases it will mean a lower wage rate increase—and how it affects fringe benefits is a matter which has to be decided on the merits of each particular case. [An HON. MEMBER: "Dodgy."] The hon. Member can say that it is very dodgy, but the Leader of the Opposition is nodding his head because he knows slightly more about it than does the hon. Member. Anyone who knows anything about British industry knows that it is impossible to prescribe for the whole of British industry except on a basis which provides a ceiling. It is within that ceiling chat each case must be judged on its merits.
§ Mr. SpeakerOrder. We are long past Question Time.