HC Deb 13 July 1972 vol 840 cc1840-7
Q2. Mr. Joel Barnett

asked the Prime Minister if he will place in the Library of the House of Commons a copy of his public speech in London on 27th June on inflation and the flotation of the £ sterling.

Q8. Mr. William Hamilton

asked the Prime Minister if he will place in the Library a copy of the public speech on economic matters which he made on 27th June to the European Institute of Business Administration.

Q9. Mr. Parry

asked the Prime Minister if he will place in the Library a copy of his public speech on economic matters to the European Institute of Business Administration at Guildhall on 27th June.

Q12. Mr. Ashton

asked the Prime Minister whether he will place in the Library a copy of his public speech at Guildhall on 27th June relating to economic affairs.

Q13. Mr. Duffy

asked the Prime Minister if he will place in the Library a copy of the public speech he made to the European Institute of Business Administration in the City of London on 27th June, 1972, on the sterling crisis.

Q14. Mr. Skinner

asked the Prime Minister if he will place in the Library a copy of the public speech made at Guildhall to European businessmen on 27th June, 1972, on economic matters.

Q16. Mr. Meacher

asked the Prime Minister if he will place in the Library a copy of his public speech on 27th June at Guildhall on economic policy.

Q17. Mr. John D. Grant

asked the Prime Minister if he will place in the Library a copy of his public speech at Guildhall, London, on 27th June dealing with inflation.

Q18. Mr. Atkinson

asked the Prime Minister if he will place in the Library a copy of his public speech made at Guildhall on 27th June, 1972, concerning the question of reducing wages and salaries to solve the problem of inflation.

Q23. Mr. Dalyell

asked the Prime Minister if he will place in the Library a copy of his public speech on economic matters in Guildhall on Tuesday, 27th June.

The Prime Minister

I did so on 28th June, Sir.

Mr. Barnett

Would the Prime Minister care to clarify the mystery of the ages in view of today's good trade figures? Will he say why, when in that speech he referred to the fact that price and wage increases were not bad—he claimed they were doing very well—he now appears to be planning a statutory prices and incomes agency? If he is not so planning, will he deny this?

The Prime Minister

I am glad the hon. Gentleman has welcomed last month's trade figures. I certainly do not accept the point of view put forward in the last part of his question. I hope he will also welcome the fact that the TUC has accepted my invitation for a meeting, as has the CBI. The purpose of this is to reach voluntary agreement.

Mr. Hamilton

Will the right hon. Gentleman say why he allows other Ministers, for instance the Foreign Secretary, to talk about greedy and selfish trade unionists? The Foreign Secretary, above all in the Government, should keep his mouth shut on these matters in view of his own family record over generations in Scotland. [HON. MEMBERS: "Cheap!"] So long as the Prime Minister and the Foreign Secretary continue to castigate trade unionists and so long as Lord Carrington and other members of the Cabinet—[HON. MEMBERS: "Withdraw."]—are seeking to profiteer in the land speculation market and in other ways, they will never get the co-operation of the trade unions in any kind of wage policy.

Mr. Hastings

On a point of order. Is it in order, Mr. Speaker, for the hon. Member for Fife, West (Mr. William Hamilton) to make that type of vicious insinuation against my right hon. Friend the Foreign and Commonwealth Secretary? Should he not be required to withdraw it?

Mr. Speaker

There is a distinction between matters of order and matters of taste.

The Prime Minister

As my right hon. Friend was pointing out, it is possible for everybody in this country to make steady progress provided that we can keep productivity and wages in line. If any section of the community seeks to exceed that, it is damaging to the whole community.

Mr. Rost

While my hon. Friends and I welcome the many requests from the Opposition for the Prime Minister to deposit his speech in the House of Commons Library, may I ask whether there is not a serious risk that the Library will lose its political impartiality unless the Leader of the Opposition makes a few more speeches explaining his party's policy on inflation, industrial relations and the European Community?

The Prime Minister

I would welcome that.

Mr. Ashton

The Prime Minister said in his speech that the main ingredient in higher prices was higher wages. Will he tell us what is the main ingredient in higher rents?

The Prime Minister

If hon. Gentle men had considered the matter they would recognise that it is necessary for local authorities to charge for modern housing a rent which gives them a fair return and, at the same time——

Mr. Ashton

Not true.

The Prime Minister

I am sorry, but it is true, as the hon. Gentleman will find out if he cares to consult any local authority. At the same time our system introduces rent rebates, which is the element which benefits the lower wage earners.

Mr. Duffy

Does the Prime Minister recall that on the occasion in question he firmly placed responsibility for Britain's inflation on the TUC and the trade unions? Does he not now think, in view of the scepticism and the downright lack of trust he encountered at yesterday's meeting with the TUC and which exists amongst the public at large, that the real responsibility now seems to rest on his record in Government and on the shattering of voluntarism in industrial relations—in short, on his credibility?

The Prime Minister

The hon. Gentleman could not be more wrong. What I pointed out in my speech at Guildhall was that responsibility rests with the Government, employers and the TUC but that it requires all three to co-operate with a voluntary system. I should have thought that yesterday's statement that the TUC will take part in this deliberate voluntary effort to deal with inflation would have been welcomed by the House. [HON. MEMBERS: "Not with you."] Yes, they are. Representatives of the TUC are coming to sit down with me.

Mr. Raison

Does not my right hon. Friend agree that under Labour average council house rents rose by over 70 per cent.?

The Prime Minister

That is quite right.

Mr. Skinner

I should like to know who wrote that speech; it sounds to me as though M. Pompidou had a hand in it. M. Pompidou was saying much the same things about two days later. Does not the Prime Minister realise that the country knows that if he shows the slightest independence of thought away from M. Pompidou and the other Common Marketeers, he will not get anywhere in the Common Market and he will probably not get picked for the team?

The Prime Minister

It is characteristic of the hon. Gentleman that he speaks in those terms of a Head of State of a friendly country. The fact that we floated the £ and took our own decision on that clearly refutes what the hon. Gentleman says about our policies.

Mr. St. John-Stevas

Leaving aside the snobbish genealogical obsession of the hon. Member for Fife, West (Mr. William Hamilton), is not the significance of the floating of the £, taken together with the constructive talks with the TUC, that it offers the country the best chance of sustained economic growth that we have had in the last decade?

The Prime Minister

My hon. Friend is quite right. I hope we can speedily seize that chance at the meeting I look forward to having with the CBI and the TUC early next week.

Mr. Meacher

If Britain returns to fixed parity by 1st January, how can the economic and monetary union about which the Prime Minister spoke be seriously maintained without further devaluation unless there is centralised decision-making throughout Western Europe which will clearly require full political union? Does the Prime Minister have in mind full political union, or is he prepared to accept further devaluations with the damaging disruption of essential Community institutions?

The Prime Minister

I do not accept either of the hon. Gentleman's theses. What I have always emphasised—as I did in that speech and in conversations with Heads of Government of present members of the European Community—is that we are dealing not only with a monetary union but with an economic and monetary union, which means that there should be a firm basis for an industrial policy in the enlarged Community, together with a fully developed regional policy. Therefore, in our view, these things must go together.

Mr. Grant.

Does the Prime Minister realise that there is within the TUC a strong feeling that he is trying to force it into a shotgun marriage on wages policy? Will he now answer the question put to him by my hon. Friend the Member for Heywood and Royton (Mr. Joel Barnett)? Will he state categorically that under no circumstances will he introduce a statutory wages policy?

The Prime Minister

From the discussions I have had with the TUC, I do not believe that that feeling exists, and I met the whole of the General Council only 10 days ago. I repeat, the fact that the TUC and the CBI are prepared now to work this out with the Government is of major importance, and our purpose is to reach a voluntary agreement. I have said publicly that if the nation were facing a disastrous economic situation any Government must be prepared to take measures to deal with that, but the purpose is to work out a voluntary policy.

Mr. Kinsey

My right hon. Friend in his speech dealt with the short-term but primarily with the long-term objectives of the Government. Will he tell us whether the growth that he is looking for is provided for in the 5 per cent. increase we had last year, or does he look for further growth?

The Prime Minister

In his Budget Statement my right hon. Friend the Chancellor of the Exchequer set out his objective of 5 per cent. growth. The production figures for May which have just been published show a substantial increase, particularly in manufacturing production, of 3.1 points. That is a clear indication that we are achieving what the Chancellor of the Exchequer set out in his Budget Statement.

Mr. Dalyell

Is there to be a statutory prices and incomes agency?

The Prime Minister

No, Sir, I have no plans for that. With the TUC and the CBI we are working out a voluntary agreement. As I mentioned in the industrial relations debate last week, the trade unions have always made it a major principle that there should be free collective bargaining. They obviously are also opposed to statutory arrangements, and that was made abundantly clear under the last Administration.

Mr. Harold Wilson

Was not one of the most disastrous decisions of the Government the scrapping of the National Board for Prices and Incomes, which can still function on an educational and non-statutory basis? The whole House will recognise the importance of the right hon. Gentleman's meetings next week, whether they take place on one side of Parliament Square or the other. Will the right hon. Gentleman give instructions to his Ministers, and follow this rule himself, that the situation should not be prejudiced by a series of antitrade union speeches made for a political purpose on party occasions? With reference to the supplementary question put by the hon. Member for Derbyshire, South-East (Mr. Rost), will the Prime Minister recognise that when we have anything to say to the trade unions, whether they like it or not, we say it to them and not behind their backs?

The Prime Minister

I have had many meetings with the General Council, the Economic Committee and the General Purposes Committee of the TUC in which I have always told them exactly what the Government's policy was. I hope the right hon. Gentleman will not continue to deceive himself on these matters. When we have meetings with the TUC we talk frankly and openly. I thought it was clear from the way in which these meetings have been taking place in the past two years that this has been a working relationship. Now I hope that it will deal with the question of inflation and come to a working answer on a voluntary basis.

Mr. Wilson

If it has been a two-year working relationship, and the right hon. Gentleman has spent a lot of time proving that it was not, will the right hon. Gentleman explain why—although a few weeks ago he was asked why no action had been taken by the Government on threshold agreements, for which the Press is now giving him credit but which were put forward by the TUC in February, 1971, and which he has been peddling in his statement—it has taken 17 months of this working relationship to bring this subject forward?

The Prime Minister

I have on a number of occasions explained to the right hon. Gentleman, who seems to be quite incapable of absorbing it, that the question of threshold agreements was discussed in "Neddy" after it was produced by the TUC. It was referred to the group of four for examination and consideration, and that is what has been going on. [AN HON. MEMBER: "Working relationship?"] Since the TUC had its representative, Mr. Feather, taking part in the group of four, that was a working relationship. As it is well-known that the TUC itself is not agreed about threshold agreements, the Government cannot be blamed for not introducing them. What I have said is that this can be one matter on the agenda for our discussions next week. But the Government have not been responsible for any dragging of the feet over threshold agreements. They have been under discussion in "Neddy" and in the group of four ever since they were introduced as a subject by the TUC.

Mr. Wilson

I am sorry to press the right hon. Gentleman further on this matter, but since he has referred to the group of four, and since one member of that group is a senior Government official, may we be told whether that official at any time during the 17 months said that the Government agreed with these agreements, rejected the idea or were divided about it?

The Prime Minister

I have not claimed that the Government were divided on this matter. The group of four has been examining the basis of possible threshold agreements. All economists know, except apparently the Leader of the Opposition, that threshold agreements in certain forms can be inflationary and in other forms stabilising. [AN HON. MEMBER: "What is the Government's view?"] The Government said that they wished to analyse these agreements and to see whether they could be used for dealing with inflation. That is our position and it is a perfectly sound one.