§ Q1. Mr. Barnettasked the Prime Minister what replies he sends to letters he receives on the subject of unemployment.
§ Q4. Mr. Carterasked the Prime Minister how many letters he has received and replied to on the subjects of employment and job opportunities since 1st January.
§ The Prime Minister (Mr. Edward Heath)About 50, Sir. The great majority of these letters relate to individual cases of unemployment, which are then followed up by the Department of Employment.
§ Mr. BarnettOne would have hoped that the Prime Minister could give some consolation to the letter writers. If the right hon. Gentleman is not prepared to accept the forecast made by very serious commentators that the number of unemployed could rise to at least a million, will he assure the House that he will act long before it reaches that alarming level? If he does not, we shall conclude that he is not even prepared to act to prevent it reaching that kind of level.
§ The Prime MinisterTaking the first part of the hon. Gentleman's question, a number of these correspondents apparently do not know the right method of obtaining assistance in employment, and therefore it is right for me to pass their letters to the Department of Employment, 1357 which will do everything possible to help them.
As for the second part of the hon. Gentleman's question, my right hon. Friend the Chancellor of the Exchequer made it plain in his Budget speech and the wind-up speech that he has made his initial Budget judgment and that, if he wishes to take further action, the means are open to him.
§ Mr. CarterIs the Prime Minister aware that the Chancellor of the Exchequer yesterday once again stated the Government's view that cost inflation is the cause of unemployment—the view that the Prime Minister himself was not able to provide evidence to support in this House last Tuesday? Will the right hon. Gentleman now admit that it is the declared policy of the Government to use unemployment as their principal instrument of economic policy, with all the hardship that that entails?
§ The Prime MinisterThe hon. Gentleman is talking absolute nonsense, as usual, and he knows it. If he were more closely in touch with industry, whether it be on the trade union or on the management side, he would know of the many examples of firms which, because of wage increases, are attempting to keep down unit costs, and that the only way to do that is to stand off labour.
§ Mr. St. John-StevasWith regard to unemployment, are not the guilty men the Leader of the Opposition and his heir apparent, the right hon. Member for Birmingham, Stechford (Mr. Roy Jenkins), who, as we now know, connived at cost inflation to win the election?
§ The Prime MinisterYes, Sir.
§ Mr. Harold WilsonThe Prime Minister told my hon. Friend the Member for Birmingham, Northfield (Mr. Carter) that he was "talking nonsense, as usual". If the right hon. Gentleman will wait for the statement after Questions, perhaps he will find that that was a very inapposite comment to my hon. Friend, who was talking sense before the Government did on the matter which is to be discussed.
As for what the right hon. Gentleman said about cost inflation, will he give us details of redundancies in the steel industry, where, in order to avoid redundancies, the workers were prepared to accept a cut in wages of £2 10s. a week? 1358 Will the right hon. Gentleman take that into account in the sweeping and inaccurate generalisations that he makes to explain the failure of his Government to maintain his pledge on unemployment?
§ The Prime MinisterThe right hon. Gentleman knows, because he was in power at the time, that the programme of redundancies in the steel industry announced yesterday by the British Steel Corporation was considered and worked out while he was in power—[HON. MEMBERS: "Oh!"] What is more, the right hon. Gentleman will also recall that, during the Second Reading of the steel nationalisation Bill, one of the major arguments put forward by the then Minister, the right hon. Member for Greenwich (Mr. Marsh), was that the purpose of nationalising the steel industry was to rationalise it, to remove the older plant, and thus to achieve lower costs to enable British steel to be sold abroad.
§ Mr. Chichester-ClarkConcerning unemployment, has my right hon. Friend noted the comments of the largest single industry in this country, the construction industry, to the effect that the measures contained in the Chancellor's Budget will be helpful in producing a higher work load and more jobs?
§ The Prime MinisterYes, Sir. It is not just the view of the construction industry. This was the view expressed by the C.B.I., both publicly and in the National Economic Development Council, in the discussion after the Budget.
§ Mr. Harold WalkerDoes the Prime Minister recall that in his now notorious and cheap electoral stunt of 16th June he said that his alternative policy would not only reduce rising prices at a stroke but would reduce unemployment at a stroke? Will he, in his replies to letters, explain why this is not happening and why he has failed so disastrously on this as on so many other matters?
§ The Prime MinisterThere is no doubt that the cut in S.E.T. announced by my right hon. Friend the Chancellor of the Exchequer has held prices and, indeed, in some sectors, reduced prices.
The Government's intervention on steel prices has prevented that nationalised industry from putting up prices to the extent that it wished. For that we have been thoroughly criticised by right hon. 1359 and hon. Gentlemen opposite. They had better make up their minds whether they want us to prevent rising prices or whether they themselves want to increase prices.
§ Mr. Harold WilsonIn his optimistic reply to his hon. Friend the Member for Londonderry (Mr. Chichester-Clark) about the construction industry and the "Neddy" discussions, the right hon. Gentleman sought to give the House the impression that the cut in S.E.T. would lead to an increase in employment. Will he give a pledge to the House that unemployment by the end of this year will be less than the 800,000 recorded last week?
§ The Prime MinisterI shall adopt the procedure followed by the right hon. Gentleman and his colleagues, and not make forecasts.
§ Mr. ThorpeAs unemployment in part of my constituency is running at 10.1 per cent., when the Prime Minister writes these letters will he say whether the present astronomic figures for unemployment came as a surprise to the Government, whether they were all along expected by the Government, how much longer they will place the exclusive blame for them on the record of their predecessors, and when they are prepared to be judged on their own policies?
§ The Prime MinisterI have constantly explained the impact of the rising wage costs under the previous Administration and the efforts which we have been making to halt them. We have constantly and consistently been criticised and condemned by the Opposition for our efforts.