HC Deb 22 April 1969 vol 782 cc237-8
13. Mr. Goodhart

asked the Minister of Public Building and Works what further representations he has received about the effect on the construction industry of Selective Employment Tax; and what replies he has sent.

Mr. Mellish

I invited representatives of the industry to meet me immediately after the Budget, and the effects of S.E.T. were discussed, and I have since had letters from them expressing their views.

Mr. Goodhart

Is the Minister aware that the industrial correspondent of the Financial Times estimates the extra burden of S.E.T. for the building industry at between £30 million and £40 million a year? Does he dispute this estimate? Does not he concede that this would put up the price of houses and reduce the rate of housing building?

Mr. Mellish

I had a Press conference the day after I met the industry, and I said that the increase of S.E.T. would be between £32 million and £35 million, and that the N.F.B.T.E. estimate of about £35 on a £5,000 house is about right.

Mr. Pavitt

Is my right hon. Friend aware of the way in which this extra twist will mean that thousands more will leave the construction industry to be self-employed, and of the disastrous effect this has on the trade union movement? Will he discuss this problem with his fellow Ministers with a view to introducing an Amendment in Committee on the Finance Bill?

Mr. Mellish

I am aware of the danger of labour-only sub-contractors, whose numbers are growing. It is hoped very much that we shall be able to bring legislation before the House which will deal with that as a quite separate problem from S.E.T.

Mr. Chichester-Clark

Is not the Minister concerned from another point of view? It costs an employer £6 to get an operative on the site before he even does a stroke of work. Having given the industry a very sympathetic impression with regard to its case over S.E.T., will the Minister now show it some action?

Mr. Mellish

I have already said that I understand the industry's point of view. Representations are being made to other Ministers concerned. I can say no more than that at present.

Mrs. Ewing

Is the Minister really going to refrain from mentioning the effect on jobs as a result of S.E.T.? In particular, is he prepared to say that there will be no decrease in the number of jobs in this industry in Scotland as a result of the increase in S.E.T.?

Mr. Mellish

The industry is one in which output improved by an average of 4 per cent. over the past five or six years with a lower labour force.

Mrs. Ewing

That is no answer.

Mr. Mellish

I am answering the question as a whole; the hon. Lady asked me a question and she must wait for the answer. I am telling her that we are doing more work with fewer men employed, because the industry is becoming more mechanically-minded, using modern techniques and producing more with fewer men. I should have thought that the whole nation wanted that as a principle.

Mrs. Ewing

That means fewer jobs.

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