HC Deb 15 February 1971 vol 811 cc1203-10

3.30 p.m.

The Secretary of State for Employment (Mr. Robert Carr)

I will, with permission, make a statement.

The House will be aware that the acting Chairman of the Post Office Corporation wrote on Saturday to Mr. Jackson of the Union of Post Office Workers to invite the union to discuss with the Post Office the possibility of finding measures to improve efficiency which would enable the Post Office's offer to be increased without adding to costs. The union responded immediately to this suggestion. After a preliminary discussion on Saturday, talks between the Post Office and the union took place yesterday. They have resumed this afternoon.

The right hon. Gentleman the Leader of the Opposition asked me on Thursday to report today on the up-to-date position in the electricity supply workers' dispute. I understand that informal discussions have taken place between the two sides, who have agreed that a formal meeting of the National Joint Industrial Council should be held on Thursday.

In the circumstances, I am sure that the House will agree that further comment on these two issues would be undesirable at this stage.

Mrs. Castle

Is the right hon. Gentleman aware that my hon. Friends and I are delighted that the Union of Post Office Workers and the Post Office are negotiating again, even if it had to be on their own initiative? [Interruption.]

Would the right hon. Gentleman answer two questions? First, will he make another statement to the House tomorrow about the postal workers' dispute? Secondly, in connection with the electricity supply dispute, does he now wish in any way to modify the statement he made to the House last Wednesday on the Wilberforce Report, in the course of which he said that he had the authority of the Court to quote the figure of 10.9 per cent. as the effect on average earnings, of the Wilberforce recommendations?

Mr. Carr

The answer to the second part of that supplementary question is "No, Sir". The answer to the first part is that I will certainly make another state- ment about the postal dispute. Perhaps it would be unwise of me to give a definite promise to make a statement tomorrow; the House will agree that it must depend on the way things develop. However, I certainly undertake to make another statement at the earliest possible suitable moment.

Mrs. Castle : I must press the right hon. Gentleman on my second supplementary question.

Is he now repeating what he said on Wednesday; namely, that he had the authority of the Court as a whole to quote the figure of 10.9 per cent., as he claimed he had? Is he now reaffirming that?

Mr. Carr

Yes, Sir.

Mr. Thorpe

While everyone will welcome the fact that the two sides are now talking and while nobody would wish to prejudice the outcome of these talks, is it not an extraordinary commentary on our industrial relations situation that it should have taken one month before anybody should have put up the idea of a productivity deal which might produce a formula which could give satisfaction to both sides? Will the right hon. Gentleman address his mind to the fact that it has taken so long for the obvious to be put forward?

Mr. Carr

I assure the right hon. Gentleman that I have addressed my mind to this point many times over the last few weeks, and, indeed, before the strike arose. However, as I have explained to the House, and as it sometimes happens, alas, in industrial situations, the positions of the two sides were very firm on this, among other aspects of the dispute. I am delighted that the talks are now taking place.

Mr. Charles R. Morris

While endorsing the encouragement that has been expressed on both sides to the fact that negotiations are proceeding again, may I ask the Secretary of State to acknowledge that one of the real difficulties in the current Post Office dispute is the fact that Post Office Workers have been denied access to the Civil Service Pay Research Unit, which they previously enjoyed as civil servants? Would he urge the Post Office to establish alternative pay research machinery to avoid such difficulties in future?

Mr. Carr

Now that the Post Office is a nationalised industry, I feel that it really must decide these matters for itself, as other nationalised industries do. The House must also bear in mind the nature of the agreement on this matter which both sides signed last August.

Mr. Heffer

Returning to the question which was posed by my right hon. Friend the Member for Blackburn (Mrs. Castle), may I ask the right hon. Gentleman to say exactly how he got authority for making that statement? Was it in the form of a telephone conversation with Lord Wilberforce? Was it by way of a letter written by him? Exactly how did the right hon. Gentleman receive this authority? So that the whole House may be fully informed of the precise position, would the right hon. Gentleman give this information?

Mr. Carr

I inquired of the Secretary to the Court and he inquired of the Chairman. The Chairman gave the Secretary his authority to say to me that 10.9 per cent. was the figure which the Court—I emphasise "the Court" and not just "the Chairman"—had before it and accepted, as a Court, as being the figure implied in its recommendations.

Mrs. Castle

rose—

Hon. Members

Sit down.

Mrs. Castle

I must put this to the right hon. Gentleman because he now seems to be correcting what he said in reply to me earlier. [HON. MEMBERS: "No."] Yes, indeed. I think the right hon. Gentleman was perfectly aware that what I was asking him was whether all the members of the Court had been consulted about this figure and whether, sitting as a court, they had approved it. [Interruption.] This is most important. Hon. Gentlemen opposite may not mind the House being misled, but we do. I then made it clear that I was asking whether that figure had been given to him as covering all the items in the Report and not merely some of them.

Mr. Carr

I made it clear to the House that the figure of 10.9 per cent. was on exactly a comparable basis, as indeed it is. I also made it clear in my statement last week that as the employers' offer had been labelled "10 per cent." when, to be precise, it was 9.7 per cent., so it was right to label the Wilberforce proposal 10.9 per cent. This figure was before the Court, but the Court decided not to quote it. Nevertheless, the figure was before the whole Court and the Chairman gave his authority to me to state that that was the figure which the Court accepted as being the cost of its proposals on a truly comparable basis with the employers' offer.

Mrs. Castle

rose—

Hon. Members

Not again.

Mrs. Castle

How could that be on a truly comparable basis with the Electricity Council's offer, considering that the Wilberforce recommendations contained two items, holiday pay and lead-in payments, which were never offered by the Electricity Council? Is not the right hon. Gentleman therefore deliberately misleading the House—[HON. MEMBERS: Hear, hear."]—when he quotes the figure of 10.79 per cent., knowing that that figure did not include two important items in the recommendations, holiday pay and lead-in payments? That is why we say the Court never authorised him to quote that figure.

Mr. Carr

I must repeat that I had the authority to quote the figure I gave—

Mr. Heffer

Not by the full Court but by the Chairman.

Mr. Carr

I was authorised by the Court to quote the figure I gave. The holiday payment question was considered by the Court and—speaking from memory, but I am almost sure speaking rightly from memory—was mentioned in its Report, and it was indicated that three odd days to be taken by the staff, not collectively all at once but individually as was convenient within the year, would not add to the costs of the industry—[Interruption.]—because the time off would be absorbed without any overtime payment. Here again I am quoting —[Interruption.] Hon. Members opposite may or may not agree with it, but I am quoting the view of the Court on the effect of its holiday pay proposals on the labour costs of the industry.

As for the second question, had I included an estimate—which I think would be impossible—of the cost of the lead-in payment, the figure I would have given would not have been 10.9 per cent. but something considerably lower—I would probably have guessed it at something like 6 per cent.

Mrs. Castle

Oh.

Mr. Carr

The right hon. Lady cannot have understood the employers' offer. The employers' offer was quite clearly expressed as being an estimate of 10 per cent. on the wages bill, the earnings—[Interruption.] Oh, yes, on the earnings bill of the industry assuming a stable labour force during the 12 months. The incentive bonus payments were on offer already. They would have gone on being implemented even if there had been no claim and no offer this year. What the Wilberforce Court of Inquiry did was to offer an incentive payment to get the introduction quicker, and the faster these incentive bonus schemes are introduced the faster the earnings of individuals will go up, but the smaller the addition to the labour costs of the industry will become.

Mr. Harold Wilson

But when the right hon. Gentleman informed the House on these matters last week, did he not say that 9.7 per cent. was on the average earnings? He was not talking about the wages bill of the industry but about average earnings. Is he now saying that with the so-far undefined wages policy of the Government he is perfectly happy about any wage settlement provided that it is expressed in holidays? [Interruption.] For example, when Ministers go on television to say that no settlement in a particular industry must be more than 10 per cent., does one take it that he would be quite happy if there were a fortnight's holiday with pay added on?

Furthermore, he has just told the House now that the figure of 10.9 was before the Court—presumably a lot of figures were before the Court—but is he now saying that the Court as a whole, even if it did not publish the figure in its Report, accepted 10.9 per cent. as the increase in average earnings which the award proposed?

Mr. Carr

I am saying, and I repeat, that 10.9 per cent. was the cost accepted by the Court on a comparable basis with the employers' offer—

Mrs. Castle

Average earnings.

Mr. Carr

I made it absolutely clear that I was comparing 10.9 per cent. with 9.7 per cent.—[Interruption.] The right hon. Lady and the right hon. Gentleman can nit-pick as much as they like—[Interruption.]—the meaning was absolutely clear. The incentive bonus schemes were on offer, were being implemented, would have gone on being implemented if there had been no pay claim, no offer, no Court of Inquiry and, of course, these would have had an effect on the individual earnings in the industry quite regardless of this year's settlement. The lead-in payment was entirely concentrated on trying to speed up implementation of this process which was already going on, and the 10 per cent.—or, to be exact, the 9–7 per cent.—was quite clearly regardless of the effect of the incentive bonus payments—[Interruption.] One might presume. I should have thought, that the right hon. Gentleman the Leader of the Opposition and the right hon. Lady would have learned the basic facts of life in this industry.

Mr. Harold Wilson

While I will not comment on the elegance of the Secretary of State's favourite phrase "nit-picking", will he accept it from me that I will accept it from him if that means picking his own speeches?

The right hon. Gentleman said on Wednesday last that The employers estimated that their last offer would have increased average earnings by 9.7 per cent."—[OFFICIAL REPORT, 10th February, 1971; Vol. 811, c. 527.] The words are average earnings. The right hon. Gentleman now says that 10.9 per cent. is comparable with that, which must mean average earnings, but since he now admits that he has not allowed for the value of holidays, will he now agree that it was misleading the House to say that it was comparable if it was on an average earnings basis?

Mr. Carr

I certainly will not admit any such thing. The Court's own conclusion was that the holidays question would not add to the labour costs in the end because they would not have to be compensated by any extra overtime. The point is that the effect of the employers' offer was estimated on its own to add 9.7 per cent. to the earnings. The Wilberforce proposals are calculated to add 10.9 per cent.; that is a fact that is accepted by the Court. But, in addition to this year's offer, there is the continuing effect, which was going on anyhow, of the incentive bonus scheme agreements dating back to 1967. They also are having a continuous effect on the average earnings of individuals, as is shown by the fact that average earnings of individuals in the industry rose by about 15 per cent. in the wages year September 1969 to September 1970.

What the House must realise is that there are two quite separate processes going on at the same time; that is to say, the gradual implementation of the incentive bonus schemes, which is a continuing process, and the annual settlement. The effect of the annual settlement on its own as offered by the employers, would have been 9.7 per cent. and as offered by the Court of Inquiry would have been 10.9 per cent., and the Court of Inquiry as a whole agreed with that interpretation.

Sir D. Walker-Smith

Is my right hon. Friend aware that so far from misleading the House as is alleged from the Front Bench opposite, he has answered the questions put to him fairly, frankly and fully, and has made the position quite clear to all right hon. and hon. Members who combine a reasonable degree of capacity with the will to understand?

Mr. Carr

I am obliged to my right hon. and learned Friend.

Mr. Orme

Will not the right hon. Gentleman admit that the trade unions have a capacity for ascertaining the wages their members will get? Is he saying that the forecast by the trade unions of 15.7 per cent. is completely inaccurate? Is that what he says? They are looking at wages, and it is average earnings we are talking about and not the global sum which the right hon. Gentleman is trying to pin his hopes on.

Secondly, could he not now ask Lord Wilberforce to submit to this House a statement signed on behalf of the whole Court as to whether the members of the Court accept his figure of 10.9 per cent.?

Mr. Carr

I really do think that the hon. Gentleman and the House ought to develop some sense of responsibility as to whether they want the dispute to be settled or whether they would like it to go on. Right hon. and hon. Members opposite seem more concerned to stoke up this trouble, and to stoke up inflation and price increases in this country, more than anything else.

What is true about earnings, the potentiality for earnings in this industry, wag true before the last claim, before the employers' offer and before the Wilber-force proposals, namely, that because of the basic agreement dating back to 1967 for incentive bonus schemes, this is an industry where there is real opportunity for individual earnings to rise substantially and for the labour force to decline at the same time, thereby both increasing average earnings to an exceptional extent while not adding to the labour costs of the industry by anything but a proportion. But this has nothing to do with either the latest claim or the latest offer between the two sides of the industry, or the Wilberforce Committee. That is why earnings are rising so rapidly in this industry and why I hope we all welcome it, because we are seeing in this industry what we want to see in many more fields of British industry, namely, relatively small—in fact, very small—increases in the total wage bill accompanied by substantial increases in individual earnings.

Several Hon. Members

rose—

Mr. Speaker

Order. We must move on. Mr. Chataway, statement.

Mr. David Stoddart

On a point of order, Mr. Speaker. Is it in order for the Minister grossly to mislead this House about the present dispute?

Mr. Speaker

I cannot accept a point of order which begins like that. The content of the Minister's statement could not possibly be a matter of order. Mr. Chataway.