Price Restraint

HC Deb 05 June 1972 vol 838 cc17-9

22. Mr. Bruce-Gardyne

asked the Secretary of State for Trade and Industry if he will make a further statement on his discussions with the Confederation of British Industry about the future of its price restraint scheme and its application to the nationalised industries.

Mr. John Davies

I have nothing to add to what I told my hon. Friend on 17th Apriland 8th May and to what was said by my right hon. Friend the Prime Minister on 18th May.—[Vol. 835, c. 26;Vol. 836, c. 252; Vol. 837, c. 688.]

Mr. Bruce-Gardyne

In view of the rather worrying indications in this morning's Financial Times survey of business intentions that cost inflation may be accelerating once more after nine months of the CBI scheme, is my right hon. Friend still of opinion that renewal of the scheme will be worth while, particularly in view of the inflationary impact on the finances of nationalised industries?

Mr. Davies

Yes, I do not at all withdraw from the belief that the effect of the renewal of the CBI scheme will be to continue to slow down the pace of inflation and that this will be most valuable in this very severe battle which we are all having to fight.

Mr. Pardoe

Can the right hon. Gentleman in this connection say what discussions he has had with British Rail concerning the operation of the price-fixing agreement, and the increase in charges for, and the application of the CBI initiative to, cross-Channel ferry charges? Will he stiffen the resolve of British Rail to break the price-fixing agreement?

Mr. Davies

Yes, I am aware of very considerable concern in this field and I am discussing the matter at the moment.

Mr. Biffen

In view of the flexibility of Government policy, as indicated by the Industry Bill, can my right hon. Friend say whether he has any proposal to set up a public authority charged with the task of monitoring proposed major price and wage settlements, reminiscent of the Prices and Incomes Board?

Mr. Davies

No. I have no such intention. My hon. Friend will no doubt be aware that the CBI itself has applied certain monitoring arrangements in relation to its own price restraint policy.

Mr. Benn

Can the right hon. Gentleman say whether talks have been held with the Commission in Brussels about the extent to which it would be in order to apply a price restraint policy to nationalised industries? Secondly, in connection with the question he has just been asked, would he be a little more forthcoming about Government intentions at future NEDC meetings where the whole question of inflation is to be discussed?

Mr. Davies

As regards the Commission, the right hon. Gentleman will be aware that in certain fields of nationalised industry the present Government's position is changed by accession to the Community. This is a matter which has been debated considerably in the House. Otherwise, there has been, as far as I know, no specific discussion of the Government's position in relation to nationalised industries as regards these matters. NEDC regularly reviews the whole question of the activities undertaken throughout the economy to try to restrain the pace of inflation. This is part of its normal task, and has been for many years during which the right hon. Gentleman and I have been connected with it.