HC Deb 26 June 1972 vol 839 cc1001-80
Mr. Speaker

Before calling upon the right hon. Gentleman to move the Motion, I would inform the House that I have selected the Amendment in the names of the Prime Minister and his right hon. Friends.

3.33 p.m.

Mr. Fred Peart (Workington)

I beg to move, That this House strongly condemns Her Majesty's Government for their utter failure to control rising prices, in total breach of their election pledges to the British people. Today we are debating food prices. Although the debate will finish at 7 p.m., I believe it to be one of the most important debates that we shall have this Session. For this reason, and as I know that many hon. Members wish to speak, I hope that I shall set a good example—unlike when I spoke in the debate on the European Communities when we had a long discussion on the common agricultural policy—and try to confine my speech to about 20 minutes. I hope, therefore, that many hon. Members will be able to catch your eye, Mr. Speaker, because even on the Government side of the House there is concern about the rise in food prices.

This concern inevitably arises, too, out of recent happenings in the economy. Whether or not the £floats down, and whatever the percentage, inevitably food prices will be affected. I read only this morning in the Daily Telegraph, in the column of its distinguished political correspondent, Mr. Boyne, that there is concern on the part of Conservative back-benchers.

There is a very interesting contribution by the hon. Member for Harwich (Mr. Ridsdale), who said this to his constituents during the week-end: Without other measures, the £ is going to float with ever increasing speed from the purse of the housewife into the pocket of the shop keeper. The hon. Member continued: Other machinery has got to be set up to reinforce the Chancellor's voluntary prices and incomes policy, weakened so much by recent events. Otherwise the £ will float, but the housewives, and those on lower incomes, will be drowned in a sea of rising prices. Other hon. Members took up the same line, including the hon. Member for Rutland and Stamford (Mr. Kenneth Lewis). So it is not just on this side of the House that there is concern about rising prices.

High prices have not been high-lighted just because of the recent beef situation. Throughout the year from time to time we have had a series of headlines in nearly all our leading newspapers describing in detail the increases which have occurred. I need not read them out. Many hon. Members will have seen them over the months. Even as far back as last year, on 30th June, 1971, a headline in The Guardian said: Price of food up 10 per cent. since election.

Mr. Arthur Lewis (West Ham, North)

When was that?

Mr. Peart

That was in 1971. I hope that my hon. Friend will not interrupt me too much, because I want to finish my speech. I hope that he will catch Mr. Speaker's eye.

On Thursday, 1st June, 1972, a headline in the Financial Times said: Meat—Britain gets a foretaste of Common Market prices. Even the Farmers' Weekly mentioned recently the situation in Ulster, which is of great concern to hon. Members for Northern Ireland constituencies, and said: Ulster beef prices near luxury level. That was on 9th June. A statement by the Chief Executive Officer of the Northern Ireland Livestock Marketing Commission, Mr. O'Brien, warned that this was a situation that would develop more and more as the United Kingdom neared entry to the EEC.

On 4th June the Sunday Times said: Beef prices likely to stay up despite Prior action. I could continue with such quotations, but the simple fact is that Ministers gave pledges to the country at the General Election.

Mr. Arthur Lewis

And since then.

Mr. Peart

I shall not read in full the Prime Minister's speech because it has often been quoted inside and outside the House. Where now is the phrase "at a stroke"? Where is his pledge? Has it been fulfilled? The Prime Minister gave even more pledges. I have a whole series of examples from the Prime Minister when he from time to time addressed Conservative gatherings. There is the famous speech at Leicester on 3rd June, 1970. The Prime Minister said then: There may be an overseas balance of payments surplus, but there are precious few housewives who have a surplus on their house-keeping. In the same speech at Leicester the right hon. Gentleman said: We are determined to put the brake on prices. He also said: Then there is the housewife…The dinner money at school takes more out of her purse. Clothing the children is more and more expensive.

Mr. Arthur Lewis

VAT and all that.

Mr. Peart

What does the nation now think of the present Prime Minister and his promises at the General Election? I remember how hon. Members now on the Government benches harried my right hon. Friend the Leader of the Opposition. Their Leader gave specific pledge after specific pledge to reduce and control prices. The quotations are there and cannot be denied.

But, after all, I understand why those pledges were not fulfilled. It is because the propaganda at that time was dishonest. I shall explain to the House why that was so. The Conservative Party, then in Opposition, campaigned on a dear food policy. Indeed, the Minister of Agriculture, who is now responsible for prices, has time and again said that he believes in a high-price food policy. I have a quotation from his speech in the fisheries debate on 29th July, 1966. I have quoted it before in the House, but not in full. I liked his strong language. The right hon. Gentleman said: As a farmer, I admire the fishing industry for its guts in wanting to stand on its own feet much more than the farming industry desires to do. He went on: The time has come when we should have higher prices for food and no subsidies for either the agricultural or the fishing industries. If we did that we would get competition working in both industries and the nation would get better value because the nation has been mollycoddled for too long by receiving cheap food."—[OFFICIAL REPORT, 29th July, 1966; Vol. 732, c. 2127.] The Minister's predecessor, the right hon. Member for Grantham (Mr. Godber), campaigned on behalf of the Tory Party and took a leading part in formulating a policy which, irrespective of entry into the Common Market, would have meant the introduction of a major levy system and the imposition of import taxes on our traditional suppliers. That policy was slightly adapted by the Tory Party.

What I am saying should come as no surprise to hon. Members on the Conservative Benches because this is what they believed in and what they campaigned for. These are the promises their leaders gave and the promises which have now been shattered by events. Sometimes they have been shattered by factors outside their control—by the international situation in relation to world prices, and by matters which every Minister of Agriculture must consider. But if ever the Labour Government offered that excuse they were chided by the Conservatives.

We condemn the Government. In our short, succinct Motion we say they gave pledges which have not been fulfilled. I will not go into too much detail about the beef situation. The Minister reported to the House that this was a result of the decision by the EEC, and we must accept this. The Common Market made an alteration which inevitably had repercussions on us, attracting meat exports from this country and from our traditional supplies. When we go into the Common Market the situation might be even worse, but I will not argue about that today because some hon. Members on both sides are enamoured of the practice of the Community.

The other day we tried to expose the weaknesses of the common agricultural policy. There was a very eloquent piece of writing by the right hon. Member for Stafford and Stone (Mr. Hugh Fraser) in the Evening Standard last week strongly criticising what is happening and pleading with the Prime Minister to call a summit meeting to deal with international food prices. There could be a fall in the price of beef because the consumer will not buy it. There has been a consumer resistance—

Mr. Dennis Skinner (Bolsover)

Not in the House of Commons.

Mr. Peart

I do not know about the House of Commons but from what I know about the situation outside there has been a consumer resistance.

Mr. Skinner

Just for the masses.

Mr. Peart

The consumer resistance is not only in respect of meat. The Minister of State has admitted that there has been a consumer resistance on other commodities. I have here a recent fine pamphlet published by the Trade Policy Research Centre which quotes a national food survey. The figures indicate a fall of 2.5per cent. in per capita consumption of food in the last 12 months alone.

In other words, a high food price policy inevitably creates consumer resistance, and because of this many people in this country are not eating fresh meat and not eating the better quality cuts. Their low incomes are forcing them to buy other food, and this is happening everywhere. This confirms what even the Conservatives have been saying this weekend in some of their speeches. Perhaps the Minister's decision on the suspension of customs duties on beef may help. But our weekly beef supply is running in the region of 20,000 tons. United Kingdom production in round figures is about 16,000 tons and the remaining 4,000 tons are imported. Of that we import 1,500 tons from Ireland on which duty is not paid. About 1,000 tons are imported from the Argentine. Therefore, the suspension of customs duties may not be the answer, and after a period we may swing back to a difficult situation.

On the other hand, the Minister has promised an increase in production. But inevitably when we completely embrace the CAP and when we enter the transitional stage in 1973 there will be hardships for many consumers. This is what it means when the Government pursue a high-price policy for food. This is what the Minister meant when he was in Opposition and it is what the Prime Minister meant when he was spreading his propaganda in the country. The Prime Minister believed in the virtues of competition and he has always argued that a system of competition would enable the producer and the consumer to get the benefits, and now we see how this policy has failed.

The Minister has been compelled to intervene in certain commodities and there has been on play of the market to right the situation. He had to take action on sugar, milk and potatoes, and in so doing he blew sky high the political philosophy and practice of the Prime Minister, who is wedded to the philosophy of competition.

The Minister may refer to what the Labour Administration did in relation to meat supplies but I should remind him that only recently he made an announcement about the Bacon Market Sharing understanding. It says: …the Government has determined the total quantity required on the United Kingdom market in the 12 months beginning April 1st, 1972, as 639,570 tons, a reduction of 10,430 tons over the determination for 1971–72 There has been a reduction in the total quantity of bacon produced by this country for the United Kingdom market. [Interruption.] There was an agreement on the reduction.

The Minister of Agriculture, Fisheries and Food (Mr. James Prior)

The reduction was in imports of bacon.

Mr. Peart

There was a reduction or imports and it has had a repercussion elsewhere. Because of the uncertainty of the Bacon Stabiliser Administration, a system which I introduced, there has been a lack of confidence in the industry. This, linked with the reduction in our share of the British market because of the Minister's decision, has inevitably created a reduction of supplies.

I come now to the Food Manufacturers Federation. I am dealing here not with people who are necessarily sympathetic to the Opposition or who are particularly representative of the farming industry, but with people who are connected with the processing and manufacturing of food. It has issued a special report which I am sure the Minister has seen. It was published on 26th March, 1972, and said that food prices are important and that food still forms 25 per cent. of the retail price index. The index is used by the trade unions in wage bargaining. The Federation goes on to say: Since the beginning of the C.B.I. initiative the food items index has risen faster than the index as a whole. This is due to very rapid rises in the costs of raw materials. Taking the increase in March 1972 over July 1971, the total index has risen by 3.3 per cent. but the index for food items taken separately by 47 per cent. It adds: If we take the index of manufactured foods which makes up about half of the all foods index then the increase is 4.1%. It says: During the last 12 months the food manufacturing industry has been faced with massive increases in the costs of many of its raw materials. A few examples are beef for manufacturing purposes has risen between 10–25%, pig-meat by 28%, fish by 30–40%, milk powder by anything from 50% to 100%. It explains that packaging costs have increased. For example, the glass required has gone up by 10 per cent. That has been a special problem facing the industry.

I do not want to give too many detailed figures, but all those factors have inevitably had repercussions on the consumer. The Food Manufacturers Federation states: The effect on the consumer, and particularly on the lower income groups, is obviously very severe….The housewife is acutely aware of the price increases in food and adjusts her purchases accordingly. The latest evidence published by the independent research organisation, A. C. Nielsen, shows a decline in the volume of grocers' sales for the second year running. That has had an effect on the people in the industry. Employment went down by 7 per cent, in 1971, from 770,000 to 700,000, and the FMF expects future cost increases. The 2 per cent. figure given by the Minister after he had changed his earlier figure could well be wrong. A. C. Neilsen thinks we shall face extra increases much higher than 2 per cent. For example, the industry expects very high price increases for many major raw materials in the cereals, meat and dairy sectors, including rising prices of milk for manufacturing purposes, which will lead to increases of 40–60 per cent. in butter prices and 30 per cent. in cheese prices if we embrace the common agricultural policy. The White Paper states that the figures given by the Minister are only the averages, and for many commodities in the transitional period there will be high percentage increases in prices, which will have a tremendous effect on the consumer.

Conservative Members say "But we shall make social adjustments". How- ever, many people face hardships now, and they want adjustments not at the end of the transitional period of the CAP but now. If nothing is done there will be a tremendous outcry in the country. Even the Daily Mail said in the middle of last year Mr. Heath, you must cut prices now". I do not know what it will say now. It begged the Minister of Agriculture, Fisheries and Food then to shelve his cherished plan to switch from farm support to agricultural levies on imported produce. That is a Conservative newspaper. The cry has been repeated.

The Government stand condemned on their policies. The figures are there to be seen, and they have done nothing about them. They have let the situation slide. They have embraced a policy without asking for further safeguards. Even The Times suggested in an editorial not long ago that we should seek to renegotiate the CAP, because it could have serious repercussions on our international trade and our national position.

I ask the Minister to try to defend his policies. It is no good attacking some of us who had responsibility. He has responsibility now. I am prepared to stand by what I did in agricultural matters and compare my Price Reviews with those of the Conservative Minister whom I succeeded, who is now our ambassador in Rome—[HON. MEMBERS: "Paris."] He speaks in the spirit of the Rome Treaty. Perhaps Sir Christopher Soames will be in Rome one day. I do not know whether he will be a European Commissioner, but I wish him good luck personally. That is another matter. I do not apologise for a Labour Government's agricultural policy. I am merely saying that the views of Conservative Members have been expressed, and they must accept responsibility for policies which have created conditions leading to the present price increases. Apart from the CAP, we have had silence on the value-added tax, which I believe we shall have to have once we enter the Community.

Through their social policies the Conservative Government have had an effect on food consumption. In their first Budget in October, 1970, they ended free school milk for the over-sevens, to save £9 million. In the same Budget the price of school meals was raised from 9p to 12p, and next April it is to be increased further to 14p, a saving of £30 million. But it means schoolchildren being denied hot meals in our schools. These policies have a divisive effect in our society.

The Consumer Council was mentioned at Question Time. It was set up by a Tory Government in 1963 on the recommendation of the Molony Committee, which was set up in 1959 and reported in 1962. Then the present Tory Government scraped it in 1970. But in their General Election propaganda they paid tribute to it. The Conservative Party campaign guide, 1970, said: The Consumer Council has proved to be a powerful and influential spokesman for the interest of the consumer. What do the Government say now? Why did they scrap it? I am not blaming the farmers—

Mr. Skinner

Why not?

Mr. Peart

The butchers or the farm workers because I believe it is the Government who are responsible. We are censuring the Government, not the farmers, butchers or the farm workers—[An HON. MEMBER: "They voted for the Conservatives."] Many people voted for the Conservatives, even housewives, who now realise they were deceived when they fell to the appeal of the Prime Minister.

We condemn the Government. The Prime Minister issued a false election prospectus. The "at a stroke" pledge has been destroyed by events. The Minister of Agriculture, Fisheries and Food believes in high prices and entry into the CAP. He is an enthusiast, almost a Euro-fanatic. He and men like him will in the long run through their policies harm not only the food producer but the consumer and the nation.

3.58 p.m.

The Minister of Agriculture, Fisheries and Food (Mr. James Prior)

I beg to move, in line 1, to leave out from "House" to the end of the Question and to add instead thereof 'endorses the policy of Her Majesty's Government in the implementation of its election pledges to cut taxes and to stimulate investment with a view to achieving a faster sustained growth rate in the economy which will bring a real increase in living standards for the British people, and notes that the rate of increase in food prices has been halved over the past six months, and welcomes the determination of Her Majesty's Government to bring inflation under control'. I welcome the opening remarks of the right hon. Member for Workington (Mr. Peart), in which he said that concern about rising prices was felt on both sides of the House. I share that concern with all my colleagues just as much as it is shared on the Opposition benches. [Interruption.] I am asked what I am doing about it. In the course of my speech I will show exactly what we are doing about it and the success which we have had in some directions in dealing with the problem.

Before coming to that matter I will suggest some of the causes for the increases in prices which have come about. Without an analysis of the causes it is not always possible to suggest remedies or see the reasons for increases in prices.

There are two main reasons why prices have risen. The first is the shortage of world supplies. That can be well illustrated by butter and cheese. For most of the sixties prices were absolutely static. In fact, the price rose quite highly in 1960 but by the end of the year had fallen right away. In 1962 we introduced butter quotas with the specific intention of holding up the price. At that time there was so much butter in the world that producers in countries such as New Zealand were unable to get a return for their money, so we deliberately adopted a policy in 1962 of putting on quotas to hold butter prices steady. Those prices remained steady from 1966 to 1970. In 1970 prices started to go up, and in 1972 they had gone up from £330 a ton to £550 a ton. That was due to a combination of drought in the southern hemisphere and changes in farm policy in the Common Market countries. The only action available to us in the circumstances was to suspend the quotas and stimulate home production in any way possible. Of course, the latter takes time.

The same story applies to beef. In many respects the beef problem is associated with the dairy problem.

Mr. Cledwyn Hughes (Anglesey)

Before the Minister leaves the important matter of butter, I hope he will say a little more to the House about the present situation as there is deep anxiety amongst consumers and in the industry. Is it not the case that butter stocks are increasing substantially and may be reaching danger level? Will he tell the House what his future policies will be regarding the reintroduction of quotas?

Mr. Prior

There is no real fear at the moment that the butter mountain in the Common Market countries will reappear. Stocks are up because of a favourable spring and more milk has been turned into butter. On the whole, although prices are now down—I will say more about that a little later—there are no signs of returning to the situation which prevailed in the mid- or late 1960s. There is absolutely no justification for the reimposition of quotas. However, the Government are continually watching the situation and will take action if necessary.

Beef poses exactly the same problem. Beef consumption throughout the world has been rising at a far faster rate than beef production. In many respects butter and beef are tied together. The cut-back in dairy produce in Europe from 1969 to 1971 also resulted in a cut-back in beef production. We must remember that 70 per cent. of all the beef consumed comes from the dairy herd. For example, in Italy in the five years from 1965 to 1970 the consumption of beef went up from 35 1b. to 52 1b. per head per year. Looking at our own figures, there was a decline in imports from 340,000 tons in 1969 to 250,000 tons last year.

The pressures of demand by countries such as Italy have forced up the price enormously. For example, imported chilled chuck from the Argentine has gone up in price by 35 per cent. in the past two years.

Imports mainly for direct consumption, over which we have no control, have gone up in price by 25 per cent. since the General Election. Half of that was in the last year, but only 3.6 per cent. was in the last six months. We now have greater stability than we have had for the past two years. However, one lesson which we have to learn is to be less dependent on imports and thus less dependent on the wide fluctuations which can take place in the rest of the world. That means a bigger rôle for home production.

Any Minister of Agriculture has to keep a balance between the stability which agriculture requires and the need for reasonable prices for the consumer. The right hon. Member for Workington, in quoting one of my speeches—he had to go back to 1966 to find it—must recognise that in 1966 agriculture was beginning to feel the pinch because of the low prices and the inability of the Government to provide the cash which the industry needed. Confidence was sinking and, as a result, production did not maintain its previous rate. I shall have a little more to say about that later.

Mr. Peart

When the Minister returns to that matter, will he tell us whether he now believes in that philosophy? After all, the Prime Minister does. It was the essence of the "lame-duck" theory.

Mr. Prior

I will try to show the House in a factual way what has happened about imports and world prices.

I turn now to the second main cause of price increases—inflation, and wage push inflation at that. There is a direct relationship between price and wage increases. That was the point which my hon. Friend the Member for Harwich (Mr. Ridsdale) was making in his speech over the weekend. My hon. Friend has plenty of evidence to support him. He has that well-known statement that one man's wage increase is another man's pries increase. We all remember that. I accept what my hon. Friend was saying. So, of course, does the right hon. Member for Workington, who once said: We cannot go back to the previous ways, of wages and prices continually bidding each other up, making our economy uncompetitive and creating social injustice to those unable to keep up in the race. I absolutely agree with that. That was one of the most sensible statements the right hon. Gentleman ever made.

Mr. Peart

Not the only one.

Mr. Prior

There is no doubt that a substantial part of the increases we have suffered in the last two years is directly or indirectly attributable to wage increases.

Mr. Skinner

What about the £15 a week for the agricultural workers?

Mr. Prior

I will come to the agricultural workers. Time and again, the impact of wage costs, whether direct, as in manufacturing, or indirect, as in transport and distribution, or general, such as the cost of tin-plate, power, etc., is said by manufacturers to be the main cause of their increases.

Mr. Peart

Meat prices?

Mr. Prior

Over the last two years earnings have gone up at a faster rate than food prices or prices generally. During the last year earnings went up by approximately 5 per cent. whereas all items in the cost-of-living index went up by 2.3 per cent. and food prices by 1.1 per cent. So it cannot be argued that wages have to go up to meet the increases in the price of food. At the moment there is no justification for that.

We have taken action to reduce taxation. Purchase tax on food items has been cut from 22 per cent. to18 per cent. I contrast that with what happened when right hon. and hon. Gentlemen opposite were in office. They put up the purchase tax on items of food subject to such tax. We have halved selective employment tax and will abolish it next April. That again is in stark contrast to their record when they were in office. The abolition of selective employment tax next April will mean at least £25 million to the food industry. We have cut income tax on three occasions, once a direct cut and twice on the allowances. We put £1 in everyone's pocket from April this year. We have cut corporation tax from 45 per cent. to 40 per cent. We are giving greater incentives to investment, and, thank heavens, profits in the food industry are also getting back to more realistic levels. The importance of that is very simply that unless we get more investment in our food manufacturing industry our competitiveness both at home and in Europe will suffer. So I regard that as being a very important sign indeed, and a good sign for the future. I believe that manufacturers have done extraordinarily well in the past two years to keep their prices down as much as they have.

Now I come to the second series of actions which we have taken. This relates, of course, to safeguarding those who are not paying taxes and those who are on pensions or low incomes. We have given a guarantee that the old-age pension will go up each year by at least as much as any increase in the cost of living. No Government have ever given that before, and we should take credit for it.

We introduced the family income supplement, an aid for 80,000 families and we have increased it this April so that a family qualifying with one child will get an extra £1.

If we look at the figures over the period since November, 1969, we find that the increase in the food index is 26 per cent. When the pension goes up next October it will have gone up by 35 per cent., so there will be a considerable increase in the value of the pension.

Coming to the lower income groups, there is a willingness to be sympathetic towards them but also the need for co-operation by the unions to make sure that additional increases here are not matched by similar increases right through the whole wage structure. This brings me straight to the agricultural worker. For sheer blatant hypocrisy, the early day Motion put down by hon. Members opposite is about the worst example even this Opposition can drag up. Hon. Members should talk to agricultural workers and hear what they have to say, and talk to the unions and hear what they say about that Motion. In the six years that the Labour Government were in charge they twice referred proposals of the Agricultural Wages Board to the Prices and Incomes Board. They were not even prepared to accept the Agricultural Wages Board at that stage, but at other times they allowed the board to work normally.

In the six years of Labour Government agricultural wages went up by 38 per cent. and food prices by 31.1 per cent., and the differential between the real increase and the food increase was 22 per cent. of the rise in food prices. In our two years wages have gone up 23 per cent. at a time when food prices have gone up 17.4 per cent., a differential of 32 per cent. So I hope very much that hon. Gentlemen will keep quiet about their record as regards the agricultural worker when they were in office.

Mr. George Wallace (Norwich, North)

It is your record we are worrying about.

Mr Prior

Our record is considerably better, and the Opposition have every right to be worried about it.

Mr. Skinner


Mr. Prior

I am always giving way, but I am not giving way any more.

To move on to the further action that we have taken, we have suspended the butter and cheese quotas, we have suspended the tariff on imported beef, we have taken direct action to contain the rise in sugar prices—caused mainly, I might say, by the additional commitment we made last autumn in the Commonwealth Sugar Agreement. That was the first increase given to the Commonwealth Sugar Agreement countries for many years, in fact since 1965, and it just does not add up for the Opposition to make all this fuss about help to the underdeveloped countries and the sanctity of the Commonwealth Sugar Agreement when this Government has actually done something about it and they did nothing the whole time they were in office.

Mr. Norman Buchan (Renfrew, West)

Would the right hon. Gentleman now repeat the assurance he gave us at Question Time that the Common Market countries have accepted the Lancaster House Agreement?

Mr. Prior

We are going to debate the Commonwealth Sugar Agreement tomorrow and I will wait until then to give the hon. Gentleman a full answer to the questions he has asked. The hon. Gentleman seems to know the answers an way, so I do not know why we bother to give them to him.

We have reduced the price of milk and cut down the price of potatoes by allowing the deficiency payment to stabilise prices this spring.

Those are some of the measures that we have taken. We have also done something more. We have brought about a return to confidence in our agricultural industry. From 1964–65 to 1969–70 there was a 5 per cent. increase in the net product of the industry. We are now confident that the industry is going to grow by not less than 4 per cent. a year as opposed to 5 per cent. in five years—more in one year than in nearly the whole of the term of office of the party opposite. Butter production is up by 20 per cent.; cheese by 36,000 tons—very nearly 20 per cent.; beef will be up next year by at least 50,000 tons compared with this year. This really is the best possible protection for the housewife and the best possible deal for the country.

What is the result of the actions we have taken? The best guide to what has happened is the food price index. Hon. Gentlemen like to use it when it produces figures which support their arguments, and they must accept it, too, when it tells a different story from the one they wish. The latest food index figures confirm that food prices are rising much more slowly. The annual rate of increase has fallen from 11.1 per cent. in March to 6.4 per cent. in May. Compared to the position last December the annual rate of increase has been halved. [Interruption.] Hon. Gentlemen laugh, but of course they will know, or ought to know, that in the past six months the food index figure has risen considerably less fast than it did in the six months before the General Election, so I hope they will laugh that one off. Prices are still rising, of course, but they are rising much more slowly, significantly more slowly, than in the period before the General Election.

Mr. Sydney Bidwell (Southall)


Mr. Prior

No, I will not give way. A year ago when we had a similar debate the hon. Member for Norwich, North (Mr. Wallace) made much of the figures produced by the Eastern Evening News, I think it was. He has been considerably quieter this summer than he was last summer, and perhaps this is because the last figures that we had showed that there had been a fall from December, 1971, to May, 1972.

Mr. Wallace

I am certainly agreeable to the figures given, but is the right hon. Gentleman aware that that drop was entirely due to the large drop in the price of apples? That is enough to give him the pip.

Mr. Prior

It is very difficult to deal with specious arguments, but the fact is that there was a fall and the hon. Gentleman has been much quieter ever since.

If hon. Gentlemen opposite do not like accepting the food index, as they do not always when prices are down, perhaps they will take someone else's figures instead, those provided by one of the leading retailers in the country. His weighted figures show an increase from May, 1971, to May, 1972, of just under 5 per cent. Those figures compare with the figure for the year June, 1970, to June, 1971, of just over 11 per cent. So we are finding that the lower figures produced by the food price index are backed up by other people's experience. Again, there is a much greater awareness by housewives of price increases and whether they can get good value for money. [Interruption.] Hon. Gentlemen seem to find that extremely funny, but it happens to be true. The National Food Survey figures show that housewives make better purchases than would be expected from the weighted averages of the food index. The weekly expenditure on food per head of the population shows an increase in the first quarter of 1972 over 1971 of 3p per week per person—that is, 1 .3 per cent.—at a lime when the food index is up by 4.1 per cent.

There is no doubt that the publicity from this House and through the national Press has done much to make the house wives a good deal more conscious of getting value for money than they were before. The national Press is very often sensational, but not always very accurate. It produces almost regular weekly charts and clocks, but they are not really properly weighted. I suggest that if the national Press would put its own clocks next to the food price index clock, and perhaps the National Food Survey clock showing household expenditure on food, its readers would have a much better comparison.

Mr. Skinner


Mr. Prior

I am not giving way to the hon. Gentleman.

The fact is that when prices go up that is sensational news, but when they go down the downward move is forgotten. We all know that beef prices went up. Do we all know that they are coming down again? Do we know that butter is 2p to 3p a 1b. cheaper than it was a month ago? Do we know that eggs are 4½ per dozen cheaper than they were a year ago? Do we know that poultry meat is 2p cheaper per lb. than it was a year ago? Do we know that coffee, margarine and other goods are cheaper than they were a year ago?

Although these are marked improvements, much more needs to be done before inflation is brought under control. The seeds of inflation were sown some years ago. [HON. MEMBERS: "Oh."] The Opposition do not like hearing this. I remember when the right hon. Member for Birmingham, Stechford (Mr. Roy Jenkins) introduced his Budget of 1969. He threw prices and incomes policy out of the window and said "We will have an industrial relations Bill instead." At the end, we got neither. That was the real start of the scale of the problems we have suffered ever since.

Many remedies have been tried, from income and price freezes to pay pauses and so on. All have had their difficulties and problems and some have resulted in a far worse position than they were introduced to solve. A free society and unfettered wage bargaining impose on all the responsibility to act in a fair manner, not to use monopoly power to extract more in prices or wages than the economy as a whole can stand. It is a matter not only for the Government but for all sections of the community. The Government will play their part but will expect others to do likewise.

What do the Opposition do in this situation? They support every wage claim, however inflationary; they undermine producers' confidence by demanding non-existent cheap imports; they condemn the common agricultural policy which they once accepted that we would have to support; they rejoice in every price increase and weep over every fall. Finally, they censure us for a record on food prices which in the last six months has been much better than their own. For them to rebuke us is like Satan rebuking sin.

4.26 p.m.

Mr. John Pardoe (Cornwall, North)

Although it is headed "Food Prices", and although the right hon. Member for Workington (Mr. Peart) introduced the debate as one on food prices—and with him and the Minister of Agriculture, Fisheries and Food facing each other one would expect a debate on food prices, which we have had so far—the Motion does not actually mention food prices. It refers in its terms to rising prices generally. Indeed, one cannot entirely confine one's remarks to food prices when one is dealing with inflation, as one must, as a whole.

We have heard from the right hon. Member for Workington a history of what happened under the last two years of Conservative Government. We have heard just as detailed a history from the Minister of what happened in the six years of Labour Government. Nothing perhaps is more calculated to bring out the hypocrisy and humbug in politicians than the mere mention of food prices. Whatever statistics are quoted and swapped across the Floor of the House, or in the national Press, or on party platforms, the public know that inflation is always with us, that whatever party is in power it is with us, and that prices have risen faster and faster and faster under successive Labour and Conservative Governments.

If one takes the £ as being 100 in November, 1964, it was worth only 71p in June, 1970. Taking the £ note itself to describe that decline, if one cuts down between the "B" and the "A" of "BANK OF ENGLAND", one is left in June, 1970, with a very small part after six years of Labour Government. If one takes the full £ note of June, 1970, and cuts down the stroke of the "B" in "BANK OF ENGLAND", one sees what is left now.

Let us look back to 1964 and study the record of both Governments. The £ is now worth 66p of what it was in November, 1964. In other words, it has lost one-third of its value in the last eight years under both Labour and Conservative Governments. That cut of one-third on the note itself brings us to the "I" in I Promise to pay the Bearer on Demand the sum of… We are still left at least with those words, but one wonders what will happen when they disappear.

Only last week I tried to change a £ note, which has been mutilated, given to me in change, and I was informed by the bank that it could not change a bank note that did not bear the words: I Promise to pay the Bearer on Demand the sum of One Pound". It will take only a few more months of the right hon. Gentleman before that has disappeared.

This is an interesting statistical problem which can be set for children in maths classes. Housewives know only too well—and more tears are wept over the plight of housewives and prices in this House than on almost any other subject—that this is a problem which has been with us year in and year out. The cutting of the £ note in this way serves only to illustrate the national problem and the publics' awareness of price increases.

The public are only too well aware of politicians' hypocrisy on this subject. Only last weekend we had the Prime Minister accusing the Leader of the Opposition and the right hon. Member for Leeds, East (Mr. Healey) of selling Britain short, accusing them of having caused the floating of the £, the virtual devaluation of the £. That, coming from a Prime Minister who, when he was Leader of the Opposition, spent his time charging around the length and breadth of Britain endeavouring to devalue the £ with his own words is an extraordinarily hypocritical exercise.

It was reported in our newspapers this morning that over the weekend the Leader of the Opposition had assured the housewives of Carmarthen that the Government's devaluation would lead to higher prices. That, coming from the right hon. Gentleman who talked about the £ in the pocket and tried to assure everyone that devaluation did not mean higher prices, was again an extraordinary exercise in hypocrisy.

The right hon. Member for Workington accused the Government of accepting a high-price policy inherent in our entry to Europe. This is a charge which all of us who support entry into Europe have to answer. But it is a strange piece of humbug from someone who remained a member of a Government which were anxiously endeavouring to join Europe on terms which would undoubtedly have meant that we would have had to accept the high-price policy inherent in the present common agricultural policy.

What I want to do is to say a few words about how I see the problem of prices, why prices rise—and they do not all rise for the same reasons—to try to separate the problem from the Mumbo Jumbo of party points and to try to put forward one of two constructive ideas to deal with this problem, which has baffled all Governments, and more than most this and their immediate predecessors. Not all prices rise for the same reason. There is the simple question of supply and demand, whether seasonal or permanent, there are manufacturing costs, import prices, wages and incomes, monopolies and restrictive practices and distribution costs. Food prices are less than all other prices are subject to all these factors and to several other lesser factors.

We heard the Minister of Agriculture telling us what has happened to fish prices. We heard it also from the right hon. Member for Workington. No one can say that the price of fish has risen because of high wages or necessarily because of lack of competition. The fact is that there has been a world-wide shortage of protein. That has served to keep the demand for protein high. Fish has acted to a certain extent as a substitute and we have had bad fishing conditions in the North Sea. These were forecast two or three years ago, as is possible with fish because of their complicated life cycle, which can be forecast in the waters around the world. But the increase in the price of fish has little to do with our entry into Europe. It may well have in future, when we come to be subject to the European fisheries policy, but I would suggest to the Opposition that the future price of fish is likely to be affected more by the agreement we reach with Iceland than with any policy to do with our entry into the EEC.

There is the problem of beef. We have seen beef going up and going down, not unfortunately down enough yet, but one lives in hope. There is a long-term cycle in beef, and there is a need for long-term confidence to lay down the capital and increase the output. There has been the problem of world supply. Argentine supply has been low. The EEC had to try to get rid of its butter surplus which, I agree, came about as a result of a pretty mad common agricultural policy. Any of us who advocate entry into Europe have to accept this. It was a crazy way to run the farms of of the EEC.

Mr. Skinner

Why support it?

Mr. Pardoe

If the hon. Gentleman would like to intervene in my speech from a standing position he is welcome to do so. Before he does so may I point out that his interventions are not generally enormously helpful, either to his own side or to common sense.

Mr. Skinner

Harold Lever has done all that before.

Mr. Pardoe

Clearly, this is not an intervention.

Mr. Thomas Swain (Derbyshire, North-East)

Will the hon. Gentleman give way to me?

Mr. Pardoe


Mr. Swain

I am fairly constructive at times, although I might destroy the Liberal Party. Is the hon. Gentleman criticising the common agricultural policy, having had the audacity to go through the Lobby in support of it last week?

Mr. Pardoe

If the hon. Gentleman had been here when I spoke in that debate before the guillotine fell—

Mr. Swain

I was.

Mr. Pardoe

—he would have heard me say that I regarded the European Bill as a package, and in that sense our legislation as much as anyone else's. There has been the cry that we should ban beef exports. It is no longer heard on every side now because the situation has to some extent righted itself. I can only say—and I have said this in my constituency and to those who have written to me in this manner—that if we were to ban exports of beef the only consequence would be for demand for beef on the continent to rise and high prices would be charged by those now supplying our market. There would be a simple switching operation and the price would rise here. It is nothing like as simple as that.

Mr. Edward Taylor (Glasgow, Cathcart)

I am not an agricultural expert, but I have heard this argument many times. If it is the case that supplies would simply be obtained from other sources, why was the tariff taken off by the EEC?

Mr. Pardoe

There is no question at all that supplies could switch. It is not always easy for them to do so. There are long-term agreements and habits built in. One knows only too well that shipping companies deliver to the port where there is the habit of delivery. These things change when prices change, and there is no doubt that in the long term this switching operation would have come about, and was already happening to a certain extent.

As for lamb, confidence in the farming industry has declined. The flock declined over a long period, and I do not blame this Government for that. But I blame the Government for the pig meat situation. There is no doubt at all that there has been a sharp down-turn in the breeding herd. It happened last year because of the 1971 Price Review. I was grateful to the Minister for Agriculture, who, when I intervened during his announcement of this year's Price Review, said that as usual I knew more than the NFU. I was grateful for that bolstering of confidence in my farming acumen, and I can only add that as a result of my discussions with my constituents I have discovered the opinion is shared by most of my farmers. I believe the Government have been blameworthy over the pig meat situation. It is beginning to ease, and I hope that it will ease much more rapidly in future. That largely comes about as a result of the 1971 Price Review—

Mr. Prior

I must point out that the pig cycle reached its peak in 1970 and the early part of 1971. With a pig cycle there is a considerable trough following the peak. This time we have got away with a 3 per cent. fall, which is very good indeed, and it is now rising again.

Mr. Pardoe

This is intensive farming with a vengeance—we now have pigs cycling to the trough! I accept to a certain extent what the right hon. Gentleman has said. This is not the view of the NFU, which is as critical of his policy as we have been.

Prices have not risen because of high farm incomes. That must be said immediately. Consumer expenditure on food amounts to about £8,000 million a year, and the fanning industry's net profit is only about one-seventh of this at £1,150 million a year. Farmers' incomes are not a vast part of the total consumer expenditure on food. Much more important in looking at food prices are things like distribution costs, import prices of foodstuffs, manufacturing and processing costs and margins.

Here I would raise a point about bread. It is a point which came up at Question Time with the Minister himself when I asked him last week what percentage of the total break baked in this country was baked by the top three bakery combines. He said it was between 75 and 80 per cent. One can look at this two ways. One can say either these very large bakery combines are artificially keeping the price high or that they are artificially keeping the price low to force other bakeries out of business. Both points have been made in the Press and elsewhere in the last few weeks. To my way of thinking neither is a particularly reputable approach to a market economy.

I think the Minister had better concentrate a little of his fire on bread prices and bakery prices particularly. No one can suggest that wage levels in bakeries are causing high bread prices. The Minister might wish to suggest it, but no one can suggest it. The staff working in bakeries are not by any manner of means among the highest paid in this country, nor have their increases been very rapid. It would be very difficult for the Government to try to show wages to be the cause of these inordinately high and staggering increases in prices. They are staggering increases. The price of the standard loaf rose under the Labour Government by 3p. It has risen by 4p a loaf under the Conservative Government. Those pence are new pence. That is a lot of money. These are pretty staggering increases, and it is highly likely that these increases will continue.

As I said at the beginning, this debate is not only about food prices, because the Motion talks of strongly condemning the Government for their utter failure to control rising prices, in total breach of their election pledges to the British people. This debate is taking place under the shadow of the decision to float the £, and there is no doubt at all that higher prices have caused that decision. Whatever the Cabinet decided on Thursday last week, they had changed their minds by Friday, and there is no reason to doubt that the major factor in forcing the Government to float the £ was rising prices.

They would not have forced me to float because my hon. Friends and I would never have fixed, but the Government went out on a limb last December when they decided on a new parity which was a revaluation of the £against 32 or 34 other currencies in the world. I maintained at that time that that act was an act of economic madness, and I told the Chancellor that he would not be able to maintain that parity because of the rise in prices which would take place. It happened at a time when British prices were rising, and had risen, over a long period of time, faster than those of our major competitors. This has continued, and the Government were faced last week with a situation in which the value of the £ was untenable.

I know that we have had denials, and that we have had them from the Government this week and on Friday, and that the statement that the decision was forced by a purely technical situation, and that it had nothing to do with the real competitiveness of the £ or the real problem of British inflation. All that is absolute nonsense. The competitive position of British industry was actually worse at the beginning of this year than it was before devaluation in 1967, and the rot was increasing all the time. Two or three weeks ago we had a forecast by the National Institute for Economic Affairs that the trade deficit in just six months of this year would be £142 million. Only six days later we had actual figures from the Department of Trade and Industry showing that in the first five months of this year the deficit had already gone over £200 million. So the pace of things was overtaking the forecasters day by day and week by week.

The Conservative Party at the last General Election, as, indeed, when it was in Opposition, committed itself against a prices and incomes policy, and it castigated the Labour Government back in 1967 and 1968 for attempting to introduce a prices and incomes policy. It castigated the Liberal Party for supporting the Labour Government, against many of its own elements. Indeed, the Conservative Party at the time was suggesting a vote on prices and incomes.

The position of my party has remained clear. We cannot have in this country full employment without stable prices, without a statutory prices and incomes policy. My right hon. Friend said that, following devaluation in 1967. We made it clear that we would support all the way along the line a prices and incomes policy which would ensure that devaluation worked and that any benefit from it would not be just frittered away.

It has been frittered away—not just by the Conservative Government; it was frittered away by the Labour Government as well—by the catastrophic failure to mount a credible incomes policy with sanctions behind it and the full force of law behind it. Are this Government going to throw overboard the commitment which they made on this question, for political reasons, before the last general election, or are they going to give us a statutory prices and incomes policy? Now, I am afraid, because they have left it late in the day, they will have a prices and incomes freeze and a dividends freeze as well. Unless they do, this devaluation—because that is what it is—will be frittered away in higher food prices, higher wages and dividends, as the last one was. This is the point about floating the £. It simply comes as an excuse for anarchy with the smell of the Weimar Republic about it.

4.47 p.m.

Mr. Charles Morrison (Devizes)

It was a pleasant change to hear from that side of the House a speech which made an attempt to be constructive in a debate of this variety. I thought that the hon. Member for Cornwall, North (Mr. Pardoe) was, perhaps, right in referring to the fact that debates on food prices tend to bring out hypocrisy among politicians, but I thought he would have been a little more effective if he had not spoiled his speech by such inaccuracies as there were in his references to the breeding herd. The fact of the matter is, as the latest returns show, there has been a very considerable increase in the dairy breeding herd as well as in the breeding herd.

I understood that this debate was to be a great attack upon Government policy and that there would, perhaps, be a very nasty speech by the Opposition Front Bench spokesman. But the speech by the right hon. Member for Workington (Mr. Peart) was made very nicely. The right hon. Gentleman is much too nice ever to be really nasty but, in that respect, no doubt the balance will be redressed in the winding up speech.

Mr. Buchan

I will do my best.

Mr. Morrison

I know that the hon. Gentleman is an egalitarian, and I thought that as he was one insult ahead I had better put one in now.

The right hon. Member for Workington said—I think I quote him accurately—that this was one of the most important debates of the Session. I do not think that that view can be wholly shared by his collagues on his own back benches because the number there have varied, by my count, between 17 and 27.

Mr. Skinner

What about the numbers on the hon. Member's side—

Mr. Morrison

It is the hon. Member's side of the House which is meant to be making the attck.

The right hon. Gentleman said that food prices had gone up. He said that in 20 or 30 different ways, and in doing so was doing no more than stating the obvious. But he did not say why they had gone up or what he thought the Labour Party would do about it. He did not say why because he knows full well that his supporters only too often support the causes of the inflation which has sent up food prices. He said that the Conservative Government wanted dear food and that they had introduced a dear food policy. Far from that being so, the changes in policy being introduced by the Government are no more than a recognition of the changing world food supply situation.

The right hon. Gentleman could not resist a little scaremongering about the effect on food prices of our going into the Community. He ignored the fact that pensions are to be increased annually and he also ignored paragraph 90 of the White Paper, "The United Kingdom and the European Communities", which refers to social benefits being increased for those who need them.

Mr. Peart

I was not scaremongering. I was merely repeating the arguments in the Government White Paper. There is, on the new figures, to be an increase of 2 per cent. a year. The White Paper says 2½ per cent. The Food Manufacturers Federation says there may be greater increases here and there. I am not scaremongering; I am merely repeating what is in the Government's White Paper.

Mr. Morrison

Perhaps the right hon. Gentleman will agree that the important point is that the increase in food prices attributable to entry into the Common Market is estimated at only 2 per cent., which means ½ per cent. per annum in the cost-of-living index?

The right hon. Gentleman said that he believed that we should have a value added tax when we went into the Community. Someone might have told him that we are introducing VAT now and that we shall have VAT whether we are in or out of the Community.

The right hon. Gentleman also referred to some of the factors which affect food prices. I suppose that the prime factor in the minds of most people is the price which the farmer receives for his product. The agricultural industry's net product after deducting from gross output the cost of purchases from other industries is about £1,150 million; that is to say, about one-seventh of the food expenditure by consumers, which totals £8,000 million annually, is expenditure on home-produced and imported food. Therefore, six-sevenths of the food price paid by the customer arises from factors additional to the price of the home-produced raw material. Thus the price to the farmer has only a fractional effect upon prices.

My right hon. Friend the Minister of Agriculture mentioned other factors of which the first in my opinion, although it is the second in his, is labour cost. The Opposition must remember that it is their own irresponsible attitude to out-landish wage claims which only too often has caused costs to spiral. As my right hon. Friend pointed out, earnings have been going ahead of prices.

It is important to emphasise the effect of world prices on the price of home food. It is encouraging that the price of butter has fallen. I reply to a Parliamentary Question on 5th June, my right hon. Friend said that butter had fallen by between £30 and £57 per ton. Retail prices are now reflecting this fall.

I have no doubt that the price of beef in this country will be increasingly affected by world demand. We know that Europe is short of 600,000 tons of beef. Although Europe is taking action to stimulate the production of beef, it will be a considerable time before it is able to meet its own requirements—possibly never. In the Argentine the population have one meatless day a week and therefore the potential for imports from the Argentine to Europe and to this country is limited. We know that the demand for red meat will increase as the world-wide standard of living improves and as the population increases.

Therefore, one of the main hopes of counteracting the world-wide beef shortage is the stimulation of home production. This has been done, and I believe that we shall see a steady improvement in home supplies even though in the short term the improvement may seem to be delayed. The reason is that many farmers will wish to retain on their farms to build up their breeding stock animals which previously would have been slaughtered as calves.

In addition to labour costs and world-wide factors, seasonal factors should not be forgotten. Undoubtedly the seasonal factor, coupled with the world price, is one of the causes of the sharp increase in beef prices. In this cold, miserable and damp year some beef has not been finished as early as it would have been otherwise. All these factors must be taken into consideration when thinking about food prices.

No one claims that the food price situation is wholly satisfactory—

Mr. Arthur Lewis

Without going into party politics, I think it is agreed that, for whatever reason, food prices have gone up and because of the floating of the £are likely to go up further. The people who will be most adversely affected are the old-age pensioners, who will not get an increase in their pensions until October, when they will get 75p. Yet the Government are to give an 18 per cent. increase, retrospective to last January, to people who are earning £20,000 and £25,000 a year. Does not the hon. Gentleman agree that the Gov- ernment should give an immediate increase to old-age pensioners?

Mr. Morrison

I would hardly put the hon. Member for West Ham, North (Mr. Arthur Lewis) on the cross benches as a result of that intervention. We are not in this debate talking about increases which have been given to certain individuals. I will touch on pensions in a moment.

The trend on rising prices is now in the right direction, and I believe that it will continue in that way. It is encouraging that the rate of increases of food prices over the last six months shows an improvement over the previous six months and the six months before, and also a sharp improvement compared with the last six months under the Labour Government. That is not entirely surprising when one considers the actions which the Government have taken. The list of actions is impressive. It includes the reduction of purchase tax, the halving of selective employment tax prior to its abolition, cuts in income tax and corporation tax, and the granting of family income supplements and the pension increases to which my right hon. Friend referred, which will take account not only of price increases which have already occurred but of any future increases which might occur.

My right hon. Friend is to be congratulated on his action on 8th March in cutting the price of milk in the summer months. One hopes it will be possible to maintain the lower price for slightly longer than the original announcement envisaged. It was also encouraging that he was able to reduce the sugar price and to stabilise the price of potatoes. In addition, on 5th June he suspended import duty on fresh, chilled and frozen beef and veal and, though this is not the solution to the beef problem, it undoubtedly helps the situation. In March the increase in import duty on mutton and lamb was postponed. All these factors together will already have had a considerable effect on food prices.

I have no doubt that the stimulus given to agriculture will help to maintain a a better price level in future. The impressive list of action which has been taken to maintain price levels must be contrasted with the actions of the Labour Government. Selective employment tax alone added £50 million a year to the cost of food. Purchase tax was increased from 15 to 22 per cent. and its coverage was also extended. The Labour Government, far from stimulating British agriculture, merely stimulated inflation. We have only to read the annual price reviews of those days to see Labour's appalling record in terms of agricultural production. I believe that, in contrast, we have had from the present Conservative Government direct action aimed at containing prices, whereas from the Labour Government we had direction to raise them.

Although the situation is by no means perfect, I believe that it is encouraging to see the improvement that is taking place. We can look to a steadily improving situation in future food prices if any action taken by the Government is now assisted by the Labour Party—whose support for inordinate wage claims unfortunately has been a characteristic of Opposition over the past two years.

5.3 p.m.

Mr. George Wallace (Norwich, North)

I should like to echo the remarks of the right hon. Gentleman the Minister of Agriculture, Fisheries and Food a little earlier in this debate by saying, "Here we are again." The right hon. Gentleman acted almost as a political computer in streaming out statistics. But I would remind him that statistics do not always tell the right story since they can be chosen to tell a particular story. I went shopping this morning and my experience had no relation to the picture thrown up by the hon. Gentleman's statistics. Indeed my impression is that food prices are still going up.

We are today discussing a basic problem that is faced by every family in the land, and it is one of which the housewife is daily aware. It is a problem which means that for the great majority of old-age pensioners the pensions increase is wiped out before it has even been received. Hon. Members have harped on increases to old-age pensioners. I do not want to make party points, because this problem has been around for many years. I want to emphasise that only 12 months or even less after an old-age pensioner is given an increase, its value is completely wiped out.

Mr. John Loveridge (Hornchurch)

Does the hon. Gentleman not agree that the Government have taken a great step forward in having an annual review for pensioners, and does he not recognise that prices are now rising half as fast as they were six months ago?

Mr. Wallace

Then the hon. Gentleman is admitting that they are still rising. I welcome the annual review of pensions which is long overdue, but the fact remains that when the review takes place there is a time lag of almost 12 months before the pensioner gets the increase. The poor old-age pensioner never catches up with the increase in the cost of living. I have received many letters on this subject from old people, many of them apologising for the fact that they are taking up my time, and this is an attitude that is typical of old people. I have learned from that correspondence that it is no good the Minister saying that the Government have put a £ in old people's pockets, for by the time the £ gets to the pocket it quickly has to leap out again to meet increased prices, and, in the end, it is as though they have had no increase at all.

I recently had some bad news: I became a prospective constituent of the Prime Minister. The good news is that I, as a reasonable sort of person, wish to invite the Prime Minister to come shopping with my wife and me. I want us to go to the RAGS branch at Blackfen and the right hon. Gentleman will then experience the sort of shopping problems that face people every day. I must warn the right hon. Gentleman that he might end up carrying the basket.

I should like to refer to a speech made by an hon. Lady on the Conservative Benches, the hon. Member for Merton and Morden (Miss Fookes). She is not present at the moment, but since my reference to her will not in any way be critical, I wish to refer to her remarks in Thetford in Norfolk last week, as reported in the Eastern Evening News. She said: I do believe we need a Government agency which will represent the interests of consumers. Women are particularly fitted for this work. Following that speech the hon. Lady made some more commonsense remarks which have been reported on television, and I welcome her contributions. Perhaps I should remind the hon. Lady that on Monday, 10th May, 1971, this House carried without dissent, and against the advice of the Government, my Private Member's Motion on the price inflation of basic foods. That Motion called upon Her Majesty's Government to set up an organisation for consumer protection with powers to scrutinise and check prices of essential goods and services. In view of the Minister's remarks, there may have been some significance in the fact that in the same week Norwich City Council had the biggest Labour gains the area had ever known. So far the Government have failed to implement that decision of the House. In view of the vain attempt by the right hon. Member for Lowestoft (Mr. Prior) to talk out that debate, it is obvious that the Government are reluctant to change their policy. I assume that they are fully prepared to face a vote tonight, and I hope they will have the guts to do so.

It is not the slightest use the Government sitting back and blaming wage increases for their own sins of omission. Price increases for food and services are in themselves a stimulant for wage demands. Ask any worker's wife and she will soon give one the blunt facts. The Government have abandoned the cheap food policy. Yet food prices are a vital element in the pressure on wages and salaries. This pressure is bound to increase when the effect of our entry into the Common Market is felt. The worst sufferers will be the pensioners and the low wage earners.

My right hon. Friend the Member for Workington (Mr. Peart) referred to the Food Manufacturers Association which has recently issued a price list. I have received a copy of that price list, and it shows that it expects very high price increases for many major raw materials in the cereals, meat and dairy sectors when we enter the European Economic Community. Based on 1972–73 EEC price levels, the food industry expects by the end of the transitional period to pay between 25 and 55 per cent. extra for cereals, 20 per cent. extra for pork, 30 per cent. extra for beef and about 35 per cent. extra for full cream powder and milk. Other figures have been given by my right hon. Friend, and the trend that they show is bound to lead to a steep increase in the prices of many food items over a period of time.

We must not overlook the fact that many food items are still taxed. They were taxed by the previous Government, I admit freely, but they are still taxed by this Government and, what is more, they face a VAT rate of 10 per cent., when it comes into operation. To give only a few items, baby syrups, soft drinks, ice cream, fruit juices, potato crisps, nuts and many others, are still taxed and, apparently, face a 10 per cent. VAT.

We hear a great deal about consumer resistance. If people go off beef, what do they do? There is a resistance to beef, and people turn to an alternative. But all that happens is that the price of the alternative increases, as we have seen happening with lamb and chicken. It is a natural consequence of the events taking place. We are discussing food prices, but other items such as fuel, light, heating and transport all add up to extreme pressure on the family budget.

In such a situation, the Government not only must be involved. They must be seen to be involved. One act that the Government can put into operation is to implement the decision of the House on 10th May, 1971, and bring into their consultations representative housewives whose practical common sense and experience may prove invaluable in a critical situation.

It is all very well our talking about the housewife. She is very seldom called upon to give a practical contribution. That applies to both the main political parties and in the country generally. We could do with far more women in this House. They might wake up some Ministers. The hon. Member for Merton and Morden has pointed the way, and I regret to see that she may not be with us in the next Parliament.

Price inflation is a battle in which the weakest go to the wall. The Government talk about co-operation. Co-operation between the Government and the people is an urgent necessity. The Government must provide the means to that end. I suggest that they now put into operation the will of this House expressed on 10th May, 1971.

5.14 p.m.

Mrs. Jill Knight (Birmingham, Edgbaston)

A man once said that the most sensitive nerve in the human body was the hip pocket nerve. That is a male point of view. However, the biggest worry in the life of the average housewife is the purse and basket headache. Housewives might be forgiven for thinking sometimes that they have no friends in this House as prices go on rising, and it is no wonder that they are a little inclined to say, "A plague on both your houses."

However, the average housewife has a good deal of solid common sense. She knows what has been happening, and I am sure she will join me in expressing her disgust at the blatant hypocrisy of the Motion which has been tabled by right hon. and hon. Gentlemen opposite. The Opposition remind me of an arsonist rushing to put down a Motion of censure on the fire brigade. After all, who started the inflation? It was started by right hon. and hon. Gentlemen opposite when they were in Government. That is when this raging, runaway inflation began, and it is hypocrisy past belief for the Opposition now to move a Motion of censure on the Government. One sees plenty of hypocrisy in this House, but really this is quite a record.

Earlier today, my right hon. Friend the Minister for Agriculture, Fisheries and Food gave some examples of prices that had gone down—[Interruption.] It is all very well for the hon. Member for Carmarthen (Mr. Gwynoro Jones) to laugh. Probably he never does any shopping—

Mr. Gwynoro Jones (Carmarthen)

I might point out to the hon. Lady that I am the father of two small children, and my wife frequently sends me out to do the shopping at weekends.

Mrs. Knight

In that case, I cannot understand why the hon. Gentleman finds this such a laughing matter. If he knew anything about the daily grind of shopping he would understand the justification with which my right hon. Friend pointed to some of the prices which have come down.

Last year in Birmingham, I took photographs of a number of shops—

Mrs. Doris Fisher (Birmingham, Ladywood)

Where in Birmingham?

Mrs. Knight

A number in my own constituency, but quite a lot in the hon. Lady's constituency. I did that after the cuts in indirect taxation, because many Birmingham shops were displaying large posters in their windows pointing out the price cuts in the goods that they were selling, thanks to the Government's action. As my right hon. Friend said, no one on the Opposition side likes to mention facts of that sort. But they should not be omitted from a debate of this nature.

There are occasions in this House when Pavlov's dogs should give up and go home. Now and then certain statements produce a baying from the Opposition benches. Right hon. and hon. Members opposite shout, "At a stroke". I remind them that when the Conservative Government came into office they took action at a stroke to bring down the rate of inflation. No one with any sense imagined that that action would bring raging inflation to a halt immediately. However, there is not much sense in the heads of those right hon. and hon. Gentlemen opposite who keep up their baying. The fact was that action was taken, and we are beginning to see the results of it. We should have seen far more results if trade unionists and others had played a more responsible part in the difficulties facing us.

Mr. Buchan

I have a great deal of sympathy with much of what the hon. Lady says in general terms about people bending facts back and forth. However, in serious defence of the Prime Minister's statement she said that, after all, her right hon. Friend should be forgiven for that statement—

Mrs. Knight

I did not say that at all.

Mr. Buchan

She said that his statement should be understood—

Mrs. Knight

No, I did not.

Mr. Buchan

Then perhaps she said that his statement should not be under stood. I think that she said in terms of prices that it would be done gradually and that the Prime Minister never said that he would do it overnight—

Mrs. Knight


Mr. Buchan

May I remind the hon. Lady that there are two separate parts to this question? Her defence was fair on prices, with one exception with which I hope to deal later. However, in terms of unemployment there is no defence, because the Prime Minister's phrase was not …to act on the increasing unemployment", but "to bring down unemployment". There is no defence on that one. Can the hon. Lady explain that?

Mrs. Knight

The hon. Gentleman must allow me to make my speech in my own way. I have no doubt that he will wish to do the same when he comes to make his own speech. The hon. Gentleman must not try to put words into my mouth.

I was explaining my reaction to the constant baying from the Opposition about the words "at a stroke". I went on to say that we took action at a stroke, and that is absolutely true. One action that we took at a stroke was to stop increased postage rates which were already on the stocks and which were to come into effect immediately after the 1970 General Election. That was delayed. Postage rates have gone up since, but I am most grateful, as are housewives, for that period of time when price increases were held back. Other price increases were held back by the Government, and their action at a stroke merits our gratitude and rather less of the mindless baying that comes so frequently from right hon. and hon. Gentlemen opposite.

Surely even the Opposition cannot object to the CBI initiative, which was taken as a result of talks with the Government. The fact that indirect taxation was cut enormously led to those price cuts about which I spoke earlier. The halving of selective employment tax and two cuts in purchase tax led to a reduction in prices and helped a great deal. It is no good talking about rising prices unless one talks about the amount of money in people's pockets which enables them to pay the prices demanded in the shops.

I watched with rueful amazement hon. Members of the Opposition laughing when my right hon. Friend reminded them that the Chancellor had given them an extra £1 a week in their pockets as a result of the cut in income tax.

Mr. Alexander Wilson (Hamilton)

Will the hon. Lady give way?

Mrs. Knight

No, we do not have long for the debate and I can delay no longer. That fact should be put against the demands for more money. A £1 a week cut in income tax should have meant a very great deal more restraint in wage demands than it did. The Government drew attention to the need to draw back on wage increases. What amazes me is how the Opposition keep talking as if increases in wages have no reflection in increased prices. As they have already been reminded today, they should become acquainted with the words of the Leader of the Opposition, who said perfectly plainly that one man's wage increase is another man's price increase. If the Opposition do not believe that, it does no good to try to present a picture of reality to them.

One of the gravest worries of housewives at present is the way in which wage demands are being settled at amounts far higher than the 4½–5 per cent. which the Government earlier said was the norm which was necessary. I refer particularly to the rail strike. The first suggestion for a wage settlement was that the railwaymen should be given an 11 per cent. increase. The figure then rose to a 12½per cent. increase and finished at around a 14 per cent. increase. This is the core of the housewife's worry.

How can it be possible for increases of this size to be paid without an immediate reflection in still greater rises in prices? Sometimes I wonder whether Lord Denning, for instance, has considered the effect on prices of his recommendations. If he has, I feel that there could not possibly have been such a high wage settlement recommended for the railwaymen. [HON. MEMBERS: "Oh."] Everything that we buy in the shops has to be transported at some time. Much is transported by road but a very great deal is transported by rail. If the hon. Member for Penistone (Mr. John Mendelson) is suggesting that however high a settlement the railwaymen had won there would have been no immediate effect on prices, obviously he and I do not talk the same language.

Mr. John Mendelson (Penistone)

No, I was merely being helpful to the hon. Lady by warning her that if she carried on like that about Lord Denning she would need the help of the Official Solicitor quite soon.

Mrs. Knight

I appreciate the hon. Gentleman's concern for me. It is rarely shown, but much appreciated.

It is the kind of wage settlement that we saw in that case, only a week or so ago, that occasions the greatest worry at present in the minds of housewives; partly because there was a 9 per cent. increase given only last year, partly because there was no special case for it and partly because housewives feel that this will immediately give the green light to other wage settlements which would give the coil of inflation another kick upwards.

The right hon. Member for Workington spoke about school meals and said that mothers could not afford them. I remember that when he was on the Government side of the House and when the Labour Government increased the price of school meals, I—heaven help me—went on "Woman's Hour" to defend that action, which I thought absolutely right because the price of school meals was so far below the cost of providing them. I remember saying that there would be a return of the number of children taking school meals. There was a drop for a short while when mothers grumbled about the increases; but the numbers went back, as I knew they would. The simple reason was that mothers could not feed children at home as cheaply as they could be fed in the school canteen. The right hon. Member should remember that that is a very weak point on which to attack, because the Labour Government increased the price of school meals.

We can have very touching speeches about old-age pensioners and about the gap between when pension increases are announced and when they are paid. Let no one in the House think that either side has a monopoly of concern for pensioners. Exactly the same remarks were made about the time gap under the Labour Government. We were then told that administrative difficulties made it quite impossible for pension increases to be announced one week and put into pensioners' pockets the next week and that there had to be this long time lag.

It would be far better to clear from the debate subjects which are completely common to both sides. Anyone who has been on the Government side of the House knows that there are certain things which a Government have to face and cope with. After a General Election it is no use going over to the Opposition side of the House and accusing whichever party is in Government of not doing something that the other party well knows was administratively impossible when that other party was in Government.

The housewife wonders what is to happen when the increases in railwaymen's pay reach other unions. She also wonders about the statutory incomes policy. She is fairly nervous about this because she has no trust or faith that those magic words would result in lower prices in the shops.

Finally, if the Opposition are anxious about inflation and care about rising prices, pensioners and housewives, they should use their very considerable influence with the trade unions to pull back on inflationary wage demands. Let us have one nation with everyone shouldering responsibility and no one gaining unfairly in his pocket at the expense of rising prices.

5.28 p.m.

Mr. Alfred Morris (Manchester, Wythenshawe)

The Minister's opening speech reminded me very much of a saying of Oscar Wilde. Asked if the first night of one of his plays had been successful, Wilde replied: The play was a great success, but the audience was a failure. The Minister cannot be allowed to treat British housewives as a failed audience of his policies. They have been very badly hurt by his policies. What is more, their intelligence has been insulted by the Government's long series of excuses for the right hon. Gentleman's abject failure to control prices.

I shall give him a tip. He should stop lecturing housewives upon the virtues of shopping around. They are sick and tired of having to shop around. Wherever they go, they find that prices are infinitely higher than they were two years ago. They feel deeply betrayed when they compare the Government's performance with its precepts at the last General Election. This is an anniversary month for the Minister. He has now held this present post for two years. [HON. MEMBERS: "Too long."] In celebration of the anniversary, he has now notched up a record-smashing 15,000 grocery price rises. That is the staggering total of food items that have increased in price since he became Minister two years ago. Even today, the cost of the Conservative Administration is still soaring upwards as more and more increases are announced. There has been reference in the debate to particular pledges made by the Prime Minister in his speeches at the election. But the Tory Manifesto said: We have become resigned to the value of the £ in our pockets or purses falling by at least a shilling a year. Since the Conservatives took office the £ has been falling in value not by a shilling a year but by 1s. 6d., or 7½p. In the last two years of the Labour Government the value of the £did fall by a shilling each year, which means that prices have been rising one and a half times as fast in the first two years of Conservative Government as in the last two years under Labour. This completely gives the lie to the Prime Minister's claim that he has cut the rate of price increases.

The Prime Minister has in fact put up the rate of price increases by 50 per cent. We have a floating £and a drifting Government. Labour spokesmen are not alone in attacking the Government on rising prices. My right hon. Friend the Member for Workington (Mr. Peart), referred to the statement by the Food Manufacturers' Federation. As the Federation points out, if the Minister wishes he can reduce the food price index by 1 to 1½ per cent. immediately. He can do so by making representations to the Chancellor of the Exchequer to relive from taxation certain foods which now bear tax. It is the Federation's estimate that this would reduce the food price index by the 1 to 1½ per cent. The Federation says: The Government can show its determination to deal with the question of the inevitable rise in food prices by abolishing purchase tax on, and including in zero rating for the purposes of VAT, all the items concerned, namely ice-cream, soft drinks, potato crisps, chocolate biscuits, sugar and chocolate confectionery, and pet foods. It goes on to say Removal of tax would lower the food index by 1–1½ per cent. As my hon. Friend the Member for Norwich, North (Mr. Wallace) pointed out, and the Food Manufacturers' Federation has also emphasised, rising prices are a matter of critical importance if the Government wish realistically to deal with the problems of inflation. The hon. Member for Birmingham, Edgbaston (Mrs. Knight referred to the trade unions. I hope the Minister of State will tell us, when he comes to reply, what part the trade union movement has played in the recent massive increase in beef prices? The right hon. Gentleman replied to me recently when I put a Private Notice Question to him about meat prices: ….the Government are naturally very concerned and will continue to keep the situation under close review."—[OFFICIAL REPORT, 5th June, 1972; Vol. 838, c. 33.] What further action has been taken since that statement? Neither he nor his ministerial colleagues can say they are unaware of the seriousness of the position. I recently tabled a Question to the Leader of the House about the average price paid for beef by the Catering Sub-Committee in June, 1970, and June, 1972. In reply, I was told that for sirloin the House of Commons had to pay an increase of nearly 50 per cent. between June, 1970, and June, 1972; for top side the increase was one of about 60 per cent.; and for stewing beef there has been a price increase of about 50 per cent.

I was approached recently by a butcher in Cardiff after raising the question of who has been profiteering out of higher meat prices. In his letter, my correspondent says: I am pleased to note that you have raised the point about profits in the meat trade. The most glaring example of this is in imported lamb, which is already in cold stores or on board ship. In the past eight weeks the prices have been as follows: 16.1p, 16.6p, 17.lp, 17.2p, 17.8p, 18.6p, 21.0p, 22.5p—an increase of 6.4p on stocks already here (or on the way). Surely this is taking advantage of the shortage of beef and means an extra £1.25 to £1.50 per lamb on top of normal profit. I hope that the Minister of State will deal with this quesion when he replies to the debate.

We need not recall only the Prime Minister's pledge to reduce prices at a stroke and to deal with unemployment in the same way. In another speech at Leicester on 3rd June, 1970 he said: Then there is the housewife. Her housekeeping mony doesn't stretch so far either, because she too is faced with higher food prices in the shops. The dinner money at school takes more out of her purse. Clothing the children is more and more expensive. That was a masterpiece of deception by the Prime Minister. The electorate were given the impression that the Government were serious about acting to reduce food prices. Yet they have increased the rate of food price increases by 50 per cent. over the past two years, compared with the last two years of Labour Government. One of the Minister of Agriculture's problems is that he also is trying to succeed in misleading the people of this country. As my right hon. Friend the Member for Workington has already pointed out, the Minister has long been committed to higher food prices. He said on 29th July, 1966, when he was in opposition: The time has come when we should have higher prices for food…for too long the nation has been mollycoddled by receiving cheap food."—[OFFICIAL REPORT, 29th July, 1966; Vol. 732, c. 2127.] That was his policy in opposition and I submit that it is also the policy he has followed in government.

Mr. Prior

Will the hon. Member give way?

Mr. Morris

If the Minister is very brief. As he may know, there has to be some time limit on speeches.

Mr. Prior

I am prepared to be brief. Had we had slightly higher prices then, we might well have avoided such high prices now.

Mr. Morris

The Minister has wriggled enough and he must not wriggle any more in this debate. He is on the record as having said that his policy would be one of higher food prices, and he has pursued that policy. He will not be allowed to mislead the people for much longer. He and his colleagues are gratuitously in creasing prices by the introduction of VAT, by the provisions of the Housing Finance Bill, by taxing children's clothes and by further increasing the price of school meals.

The Government's commitment to higher prices in joining the European Economic Community will not be passively accepted by the people. If the Prime Minister succeeds in steamrolling his European Communities Bill through the House, that will not be the end of the matter. In one sense, it will be only the beginning. For we shall argue to the country that they had no mandate whatever for the Bill. We shall insist also that the definitive question must still be decided by the British people.

5.40 p.m.

Mr. J. R. Kinsey (Birmingham, Perry Barr)

We are debating the worst problem facing not only the British Government but Governments throughout the world. What concerns us today is who handles it better—the present Conservative Government or the previous Labour Government.

The right hon. Member for Workington (Mr. Peart) said that the food manufacturers' major problem was the price of raw materials. That is so, but their price is affected by world shortages and inflation generally. Other costs, such as the overheads of packaging and transport, must also be considered, as they are important items. One of the most important items within our own control is labour costs. The Government have consistently pointed out to the country the important place in our price structure of the cost of manpower. That is said not out of spite against the unions, but because it is just one of the matters involved in the fight against inflation.

Increased cost inflation started when the Labour Government in 1969 eased their wage freeze and squeeze. Surprisingly, it has been stoked up since by the same right hon. and hon. Members who imposed that freeze and squeeze, and who today, showing signs of schizophrenia, have tabled the Motion. They have decried every increase in price but have supported every wage claim.

The Leader of the Opposition has made two statements that remain in our memory, so much so that one of them was quoted today. I refer to his statement that one man's wage increase is another man's price increase. He has also said that a week is a long time in politics. It also seems that 24 hours is a long time in politics, because no sooner did Labour right hon. and hon. Members move over to the Opposition benches than they changed their arguments entirely. They immediately supported the dockers and later the municipal workers, the power workers, the miners and the railwaymen in inflationary wage claims, all milestones on the way to inflation. Most of those claims resulted in awards which were hailed as victories for the unions, but in fact they were disastrous for the trade unionists and their wives, who have to meet the increased prices.

Mr. Jeffrey Thomas (Abertillery)

Does not the hon. Gentleman agree that only a Government as insensitive and stupid as the present Government would, having regard to what the hon. Gentleman says about the miners and other workers, have agreed to the lavish increases for heads of nationalised industries and so on?

Mr. Kinsey

I shall deal with that point as I come to it. I possibly feel as strongly as the hon. Gentleman does on that question, but that argument does not defeat the other. If the hon. Gentleman is to be true to the one argument, he must support my argument on the wage-cost factor in inflation.

With their record, only the Opposition would have the impudence to call a debate on this topic. They have a vested interest in rising prices. They want to see them going up, because they hope to beat the Government as a result and buy off the trade unions by supporting every inflationary action they take.

Despite what the Opposition say, there is an easing of the inflationary spiral. That is the hardest point to get over to the country, because housewives tend to judge, particularly in the grocer's and butcher's shop, by the highest price prevailing. That was underlined by the recent increases in beef prices at the same time as butter prices were tending to fall. The price of beef has decreased since, but I have no doubt that the Opposition would be making great play of the fact if the increase had continued.

The prices are better reflected by the retail food price index, which has been the yardstick for both Governments' actions. The hon. Member for Oldham, West (Mr. Meacher) asked my right hon. Friend the Minister of Agriculture, Fisheries and Food on 20th June for the increase in the retail food price index between November, 1969, and May, 1972. He received the staggering answer of 26 per cent., but it was the most distorted figure the hon. Gentleman could find, because it included seven months of Socialist Government. We noted from a later answer that those seven months of Socialist Government accounted for an 8.6 per cent. increase in the cost of living. If we split the 17.4 remaining to be spread over that period, we see that the increase was 8.7 per cent. for each 12-month period of our Government against the 8.6 per cent. in the seven months of the Socialist Government. The Socialist actions still carried through that 8.7 per cent., continuing to show in the 1971–72 index, not only through the wages effect that had been released but also through price rises held back by their squeeze and freeze policy. Those rises began to be released into the economy during 1970–71. The effects of devaluation were also an important factor.

In reply to later supplementary questions, my right hon. Friend said that between November, 1971, and May, 1972, there was a slowing down to 3.9 per cent. compared to the 1969–70 figure of 6.8 per cent. That is welcome.

The Birmingham Evening Mail recently had a report headed: Shopping bills jump by 10% say city grocers". It said: A Midland housewife's average weekly grocery list has risen in price by around 10 per cent, since the end of 1969, a spokesman for the Birmingham and District Grocers' Association said today…Mr. John Hall, Grocers' Association spokesman, said: 'A rise of around 10 per cent. is probably lower than many people would have expected. This is because the grocery trade is highly competitive and many manufacturers' price rises are not passed on to the housewife'. He is saying that by shopping around the housewife can and does save, as my right hon. Friend has so often said. It should not be said that the housewife is fed up with shopping around. She is an expert at it, and that is what many housewives want to do.

The pensioners have also been mentioned in this debate. I quote again from the Birmingham Evening Mail, but this time from its Live Letters section, where a pensioner tells how he manages to live on £8 a week. It is amazing how he does it. I do not think I could do it, because he includes in his accounts church and charity subscriptions and savings amounting to over 10s. a week.

Mr. Jeffrey Thomas

I do not believe it.

Mr. Kinsey

I will pass the letter over to the Opposition, if hon. Gentlemen do not believe it, so that they may read it. They can write to Mr. Tuckwell of Erdington, Birmingham, and learn how he manages to do it. It might give them some jobs in accounting and improve their chances if ever they become the Government again.

The housewife can also show how to beat price increases. She did it successfully with beef, and she should recognise the weapon which she has in her hands. We are starting to show, as the Minister pointed out, how we can bring prices down by Government action. The result could have been better had the trade unions co-operated as did the CBI. If the unions had co-operated and proved their good faith, the Government could have acted accordingly.

We have had a recital, but I will repeat the facts: SET has been halved, purchase tax has been cut twice, income tax has gone down three times and company tax has been eased. All those measures are easing the inflationary pressure and should help considerably.

I admit that we have helped to create some inflationary tendencies. We have moved in the direction in which the unions wanted us to move. We have attempted to beat unemployment, and that is still a problem, along with inflation, which we have to keep in mind.

If we look at costs in the distributive industry, as shown in the Prices and Incomes Report on the distributive trade we will see the effect of prices on the overheads of the various distributive markets. Half the costs of the wholesale grocers are wages; 43 per cent. of costs of the retail grocers are wages; two-thirds of the butchers' costs are wages; 70 per cent. of the costs of wholesale and two-thirds of the wholesale greengrocers' costs are in the wage sector. The distributive trade is affected by other labour costs, transport being the most important. The recent railway settlement will aggravate the position.

Whilst the Government action on the wages front has been right, I must deplore the announcement on Friday regarding the increases to heads of nationalised industries and judges of a further 18 per cent. I agree with the Opposition on that matter. Let us face it: it was triggered by the Boyle Report. Of course, honour must be given to the Boyle Report, because our salary increase was accepted. However, I spoke against it in the House. It was wrong; we should have taken a lesser increase to give an example to the country. If we had done so, we could now do something about the situation. I do not accept that a statutory wage freeze is the answer. If we adopt that policy we shall get into the same problem again. Negotiations between management and men should always have in mind the end figure of the article being produced. Conciliatory action by unions on prices could be shown to work its way back into the housewives' purse.

Recent industrial strife has again reflected damagingly against the £. The floating £ is a challenge. Mr. Vic Feather questioned its effect on food prices. That point has been echoed in the House. It only underlines what we are firmly saying, that some of the inflation which we are experiencing has come from the last devaluation. The level and stability of our currency will decide further trends in that direction. If we produce a united industrial economic unit to challenge the world markets, confidence will react in our favour. That is the challenge, and the way is clearly signposted. However, we must have co-operation to beat rising industrial costs. We should never forget the lesson that led to devaluation. If the lesson is forgotten, we shall face rising food costs and further inflation, which will hit all of us.

5.52 p.m.

Mr. John Mackie (Enfield, East)

I hope that the hon. Member for Birmingham, Perry Barr (Mr. Kinsey) will forgive me if I do not comment upon what he had to say. Most of his arguments are difficult to follow and in any case I do not want to take too long.

There has been considerable chit-chat between my hon. Friend the Member for Carmarthen (Mr. Gwynoro Jones) and the hon. Member for Birmingham, Edgbaston (Mrs. Knight) about doing the shopping. I do not go shopping often, but I have done it. I am simply given a list and a shopping basket. It does not reflect well on me, but I have not noticed prices either way. However, if the hon. Member for Edgbaston says—she emphasised this strongly—that there have been decreases—the Minister and other hon. Gentlemen have quoted some of the figures—and there is still a rise of something like 4 per cent., 5 per cent. or 6 per cent., and some prices are going down, there must be a devil of a lot going up if that increase is still going on.

Mrs. Knight


Mr. Mackie

I will not give way. I am only stating a fact. The housewives were influenced by the present Prime Minister's speeches on prices. His promises were taken for granted. It is ridiculous for right hon. and hon. Gentlemen to say that those statements should not have been taken seriously. There is no doubt about it. The election was won on prices and the promises that were made. If the result was not to be immediate, and if that did not mean that something was going to happen quickly regarding food prices and ordinary things which ordinary folk use, I do not know what was meant.

The Minister, the Minister of State, and the Parliamentary Secretary have known all along that this country, which buys half its food, has not a lot of control when there is a world scarcity. They have known that for years and years. Yet during our term of office the Parliamentary Secretary in particular—yes, I will wag my finger at him—and the Minister made points as to what we should be doing about it. After six years we kept prices lower, for one reason or another, than the Minister's 17.8 per cent. in two years. I have no sympathy for the Minister whatsoever for the pasting he has been given from my right hon. and hon. Friends. He thoroughly deserves it. I hope that it will make him a little more careful what he says when he is next in Opposition, which I hope will be shortly.

Beef has been mentioned a lot and it has raised the issue of prices over the last month to six weeks. The Minister claims that he is responsible for the increase in production, particularly that of beef, that is now coming onto the market. The squeeze of the late 1950s and early 1960s created a situation of short-term easy production. Producers forsook livestock production in favour of short-term cereal production because of the squeeze. One only has to look at Sir Christopher Soames's policies, and the policies before that, to see how it happened. There was also the disaster of the outbreak of foot-and-mouth disease. Some 220,000 cattle had to be slaughtered at fantastic cost during our period of office. That had a lasting effect.

When one looks back at the last few years, particularly in the years when my right hon. Friends the Members for Anglesey (Mr. Cledwyn Hughes) and Workington (Mr. Peart) had Government responsibility, one sees the emphasis which was put on beef over those years. We all know about the length of the beef cycle. Any increase in production that is coming now is coming from our policies and not from the Minister's policies.

The Minister has an appalling habit of finishing all his arguments—no doubt my hon. Friends have noticed—by saying that the main reason for anything happening that he has not done well is what the last Government did. There must be some point when this Government become fully responsible for what is happening. I hope they will admit when that point has been reached, because we are fed up not only with Ministers, but others, over the past two years blaming the Labour Government.

A matter which is not particularly party political concerns the on-cost of beef prices between the farm gate and the housewife. Recently I received some figures which rather shocked me. I used to think we had a better distribution system than on the Continent. However, these recent figures showed that our on-costs for beef from the farm gate to the housewife were 50 per cent. plus, whereas on the Continent they were only 30 per cent. This is a big difference, 20 per cent., in the on-cost from the farm gate to the housewife. Napoleon accused us of being a nation of shop keepers. I think we are a nation of middlemen. I am not suggesting that the individual steps in the chain between the farm gate and the housewife are inefficient, but that there are too many of them, thus creating far too expensive an on-cost for food in this country.

One point made about the figures which I received was that co-operators in the EEC got their beef from the farm gate to the housewife in one step. This would appear to be where they get their saving of 20 per cent. We should consider whether we can get a better distributive performance to save some of the on-costs.

I turn now to the short-term rises in the last six weeks—I am not talking about the 178 per cent, increase over the last two years—and how they have begun to drop this last week. At the beginning of May the wholesale price of beef to the farmer per live hundredweight was £13.68. The highest figure was £15.775 a couple of weeks ago, a difference of just over £2 per live hundred-weight. I am afraid that I shall have to use old pence, because I have not yet got used to the new pence. That is 7 old pence per 1b. dead, allowing between 50 and 58 per cent. on the killing out figure. But beef in the shops rose in price by nearly 24 old pence per 1b. I saw these kind of rises quoted in several newspapers. It was not the farmers who were getting the bulk of the increase. They got the rise of £2 per hundred-weight, but the bulk of the increase went in the distributive chain which seems much too big. For example, calf prices to the beef producer, the fattening farmer, have risen 100 per cent. in the last year. I hope the Parliamentary Secretary is benefiting from that increase and is spending it wisely.

As a result of the scarcity of milk, the price of milk powder has risen nearly 70 per cent. Barley has risen to the £30 mark. Therefore, it is not so profitable to be a beef farmer.

The Minister, slightly petulantly I think, often asks: "What can I do?" He could stop the export of beef. After all, the Labour Government stopped it during the foot-and-mouth epidemic. That would help. I know the Minister does not like to take what he calls physical action; he believes in the "let it rip" policy of the Government; but if he wants to help in any way he could stop the export of beef. After all, farmers have a guarantee, about which the right hon. Gentleman boasted, of £13.85 which should be sufficient, and I think the farmers will find that all right.

I wanted to raise this point in the debate on the reduction of the fertiliser subsidy of about £21 million. If that had been left with the farmers the price of milk could have been reduced. That would have helped the housewife. There is plenty the Minister can do if he really wishes to try. The right hon. Gentle- man knows that the price of milk affects the housewife. The right hon. Gentleman could have left the £21 million to the farmers and reduced the price of milk. There are various things which the Minister can do, but, as we know only too well, he is not will to do those things.

Mr. Prior

We have reduced the price of milk.

Mr. Mackie

I left out the word "more". The price of milk could have been reduced even more. It is easy for the Minister to say that he reduced the price of milk. How did he do it? The three Ministers are present and I will tackle them all on this subject. The Minister managed to reduce the price of milk because the milk fund was increased by the enormous increases in price of cheese and butter. Therefore, the right hon. Gentleman takes it from the housewife in one way and gives a little back in another. The awful thing is that he will not admit it.

The main indictment against the Government is that they made promises which they should have known they could not keep. For that reason, we shall vote for the Motion tonight.

6.6 p.m.

Mr. Edward Taylor (Glasgow, Cathcart)

Apart from the splendid speech by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Kinsey), most speeches have concentrated on agriculture. As this is a subject about which I know very little indeed, I shall be able to make a short speech.

The depressing thing about the debate is that, on the one hand, we have had hon. Gentlemen opposite abusing the Government for promises or pledges alleged to have been made and hon. Members on this side saying that the real problem of rising prices stems from the action of the Labour Government; but, on the other hand, we have not had many positive suggestions on how to tackle the problem of rising prices, particularly food prices. The only suggestion which was at all constructive was of a possible freeze on prices and incomes, but experience has shown that such a freeze cannot work.

If the price of beef goes up on the international markets it is difficult to have a freeze on such prices unless the State is prepared to go the whole way and fix every price and wage in the way that Thomas Aquinas suggested it might be done in a just society. But in an international society which is not just, it is impossible. We cannot fix prices if the prices of our imports are rising. I do not believe we can fix wages in a free society, because we know that employers find ways round a freeze, as they did on the last occasion by having bogus productivity deals, or something like that. Therefore, a freeze would not work, and most of us in our hearts know that.

I should like to ask my right hon. Friend some questions on this subject. The first question concerns price increases. We have had conflicting suggestions and views by hon. Members on both sides. We have heard the suggestion that prices have risen less in the last six months than in the last six months of the Labour Government and views have been expressed about a period of two years. Indeed, many people find the price index itself very confusing. It would be helpful if a clear indication could be given, and information made available, whether the price index concentrates on what might be called basic raw foodstuffs or includes tinned and frozen foodstuffs which many people nowadays buy.

There was considerable discussion some time ago about pensioners and regional problems and producing a separate index on a regular basis for elderly people living alone and for Scotland. Has any progress been made on providing a separate price index for old-age pensioners or for Scotland? Many indications lead us to believe that the increase in prices for these two categories has been quite substantial: for Scotland because of higher basic costs, such as gas, rates and transport; and for pensioners because the full range of reduced prices in the supermarkets is not available to them.

My second question concerns beef prices. I am grateful to my right hon. Friend for explaining that, because of world prices, if we seek to impose import or export restrictions now there would be a problem in that supplies might be diverted. The most worrying thing is precisely what will happen to beef prices in the future. My hon. Friend the Member for Devizes (Mr. Charles Morrison), who knows agriculture, said that there might be a deficiency of 600,000 tons in the Common Market countries shortly. We know that in the event of our joining the Common Market there cannot be any restrictions on trading between members of the Community. What will happen to beef prices some years ahead if within the extended European Common Market we have a major shortage of beef and the prospects of increasing these supplies are limited? It has been suggested that supplies this year may increase by 50,000 tons, but clearly the time must come when increases in supplies will be very limited indeed in the European context.

I should like to put some suggestions which I hope will be helpful. First, most people accept that when decimalisation was introduced many prices were undoubtedly increased as a direct result of rounding-up. That was inevitable when we moved to a currency in which the smallest unit was the new halfpenny. Increases were inevitable with a major change like that. Many housewives are greatly concerned that if and when we move to metrication exactly the same thing will happen again. We know that under the sale of goods legislation there are certain things such as tea and coffee which have to be sold in standard quantities of 4 oz.,8 oz., 1 1b. or 2 1b. When we move over to metric units it seems inevitable that this will be a further excuse for other severe hidden price rises. Therefore, I think that at the time of the introduction of metrication there will be a very considerable need to make sure that housewives are not "taken to the cleaners" as they were when decimalisation was introduced.

As we are talking generally about prices, I wonder whether my right hon. Friend can give us any indication of precisely what can be done and what is planned to protect consumers. Some people have said that there is no problem but I suggest that the majority of our people who have had experience of decimalisation do not share that view and I would like some assurance that this problem will be tackled.

My second point concerns the Government's taxation policies. As my right hon. Friend has said, we have had many reductions in taxation. These have been welcome and at the end of the day some of them should filter through to prices. But the one thing which stands out a mile is that the most basic problem in foodstuffs is the cost of transport. It seems that in the cuts in taxation transport has been largely left out. We see in the Industry Bill which has been brought before the House that massive new incentives are being offered to industry in the development areas, but no such incentives are offered to transport. To that extent I think that more emphasis might be placed on reducing the cost of transport through tax cuts instead of on the general cuts we have had in other directions.

The other question I should like to put is this. We know that irrespective of the basic cost of foodstuffs the amount of the retail margin is very significant. We see in the shops wide variations in the costs of basic foodstuffs and we know that some items cost a great deal more in some shops than in others. In our Consumer Protection Committee of the Conservative Party we had a visit the other day from gentlemen who were great enthusiasts for hypermarkets. They pointed out that a substantial number of hypermarkets have claimed that retail prices across the board have been reduced by 8 per cent. by comparison with prices in supermarket chains and small shops. I appreciate that this is a complex subject which also involves environmental considerations, but when we look at the costs which supermarkets have to pay in the centre of our cities in rates, rents and high wages, it is clear that there must be some advantage to retail costs if one establishes a very substantial store outside a city where rents and rates are certainly lower and where basis wage costs will no doubt be lower.

When we compare the tiny number of hypermarkets in Great Britain with the number in America, France and other countries, it appears that there is certainly some built-in resistance on the part of local authorities, planning councils and indeed perhaps in the Department of the Environment and the Scottish Office to such a development. I wonder whether any consideration has been given to whether the claims of hypermarkets can be backed up with facts and whether this might not have an effect in bringing down the general range of prices for consumers. This is certainly worth considering. If the claims of those who wish to promote such markets can be backed up by facts, there would appear to be a very real argument in favour of a change in the attitude of planning councils, the Department of the Environment and the Scottish Office when considering applications for these major shopping centres outside our cities.

I hope that my right hon. Friend will consider these suggestions, in which case I shall be very grateful to him.

6.16 p.m.

Mrs. Doris Fisher (Birmingham, Ladywood)

I think we are all fully aware that the Minister is a very happily married man and therefore, like the majority of husbands, must have had increased food costs brought to his attention. If he has not, he must be peculiar and unique as a husband in this country. Obviously, the close contact of a housewife with her husband must be a help even in the Minister's own home. Therefore, I wonder why we have to be subjected to pious platitudes from the Minister to the effect that prices are being stabilised when I can tell him quite clearly, along with other housewives in the Ladywood constituency which I represent, that when he makes statements of that kind he is talking out of the back of his head.

Like the hon. Member for Glasgow, Cathcart (Mr. Edward Taylor) I feel that the experience of decimalisation showed that in the absence of some sort of overall Government supervision, which could easily have been provided by the Prices and Incomes Board, opportunities are provided for traders to get away with general price increases against a background of public confusion. I am convinced that this happened with decimalisation—and I am not suggesting that housewives do not understand decimal currency. They understand how much an item costs, how much money to give and how much change they must receive. What they do not understand is the value of the money they have in their purses now. The Government's inflationary policy, along with decimalisation, has meant that the majority of housewives find that the money in their purse is practically valueless.

Mr. Wilfred Proudfoot (Brighouse and Spenborough)

Will the hon. Lady give way?

Mrs. Fisher

No, I will not give way because time is valuable to me.

We have metrication proceeding by stealth. Again I follow the line of the hon. Member for Cathcart in saying that there has been no adequate debate in this Chamber on metrication. Metrication will be another bombshell that will descend upon the housewife, followed by increased prices. This means more and more opportunities for consumer confusion, and it is at this stage that the housewife is deprived of all sense of her own judgment. I say that the housewife in Great Britain has good shopping judgment. When we hear the Minister and other members of the Government talking about shopping around as though it were a new, world-shattering idea that had come to them or something which the Minister himself, with the co-operation of the Tory Central Office had thought of that they must get housewives into the pattern of shopping around, this shows clearly that the Minister and the Government have no idea how the ordinary housewife lives and uses her money.

The housewife has always considered herself as the chancellor of the exchequer of the household, and because she is a good chancellor she wants to get value for her money. Every working-class housewife has always done this. It is nothing new. She tries to get the best value for money because if she does not her money does not go round from week to week. It is stupid for anybody to tell the housewife to shop around. I know what the majority of housewives say when they hear that said. But I shall not repeat it here because I feel sure that I should be ruled out of order. It is rather vulgar.

The housewife knows when she is getting value for money. When Government spokesmen say that the severe escalation in prices which they inherited from the Labour Government has been brought under control, the housewife knows that that is complete poppycock. She knows that to be so, not because she reads the Economist or the Financial Times or because she studies market values or understands the movement in the fat stock market. She knows it to be poppycock because she has a much simpler method of discovering the truth.

Almost every housewife has a shopping pattern, which means that she buys almost the same things every week. She buys what her children like, the dishes her husband fancies and those products that she is good at using in the kitchen. Her shopping pattern does not change very much from week to week. She may for a change buy a different kind of jam or different vegetables, depending on the season, but her shopping pattern remains basically the same throughout.

That being so, the housewife knows that the £5 a week which she spent in one store and £2 in another in 1970 will not now buy what she was able to buy then. She is able to make that comparison without reading any magazines or listening to the Minister. She knows that the £5 which she spends on her shopping at the Co-operative supermarket or at the corner shop now does not buy what she was able to get for the same money two years ago. What I am saying is so simple and obvious that perhaps the Minister will be able to reply when he answers the debate.

Perhaps the Minister will be able to tell us why the housewife is now able to purchase only 24 items for her £5 as against the 33 items which she was able to buy for that money two years ago. She has to purchase these items every week because of her shopping pattern. She cannot cut down on her shopping without her family having to go without some items of food. It is no good the Minister thinking that the housewife can suddenly chop away at her food bill. There is a limit to which she can go, and she then says "This far and no further". When that state of affairs is reached she has to tell her husband that either she must cut down on her purchases or he must increase her housekeeping money. It is as simple as that.

Perhaps that is too simple for the learned Members on the Government benches to understand, but it really is as simple as that. At some stage the housewife says that she is unable to buy the goods she needs, and she therefore asks her husband for extra housekeeping money—this is a simple process which goes on in millions of homes—and it is at that stage that the husband decides that he has no alternative but to go to his trade union and ask for increased wages. I repeat that it is a simple process indeed, If the Minister feels that he is doing sufficient to keep down prices he can blame the housewife for asking her husband for extra money, but he is not keeping down prices and nobody can blame any man for wanting to maintain the standard of living to which his family has become accustomed.

The Minister is good at apportioning blame. If he wants to put the blame on the right people, let him look at the profits flashed on the Stock Exchange List last week. He will find that two of the largest food combines increased their profits by 15p in the £ over the previous year. If the Minister wants to apportion blame for rising prices let him blame the food combines which are making such large profits.

When Government spokesmen try to explain the phenomenon of rising prices they often talk about it as the mystique of market forces. They refer to the interplay in the market between the consumer and the producer and say that this will become self-balancing. That is a view to which I do not subscribe, and if time allowed I should question closely the extent to which market forces have deliberately been manipulated. The Government's agricultural policy is manipulated against the consumer.

We sometimes hear Government spokesmen talking about competition being the consumer's best safeguard. What does competition in food mean? Hon. Members on both sides of the House know that because of the giant combines operating in the food manufacturing industry there is little or no competition, and it is hypocrisy for hon. Gentlemen on the Government side to talk about competition being the consumer's best safeguard.

The hon. Lady the Member for Birmingham, Edgbaston (Mrs. Knight) spoke about shops in Birmingham advertising lower prices, but what do they really mean? They are purely and simply sales promotions by big business in the food industry. One week Tesco advertises price cuts, the next week reductions are offered by Fine Fare and the following week they are offered the Co-operative supermarket, but these are purely and simply sales promotions.

In the Queen's Speech last November the Government promised to introduce legislation to look after consumer interests, but no such Bill has been presented to Parliament. The Government stand accused of printing misleading advertisements in their election manifesto. They gave a guarantee to the consumer that they would cut prices at a stroke. That guarantee has proved worthless, and I condemn the Government for what I regard as the greatest con. trick of the decade. The women of this country were taken in by "Con. man Ted". British housewives have their own way of dealing with the trader in the market who does them down. They are waiting for the opportunity to show the man who let them down that they will not be conned again, and this they will do at the next election.

6.28 p.m.

Mr. Norman Buchan (Renfrew, West)

What emerges at the end of the day's debate is that about the only thing that has come down in price in recent weeks is the value of the £.

The astonishing performance of the Minister of Agriculture, Fisheries and Food today in trying to defend the Government's record and his own policies in the past has not done his case very much good, and I want to talk about the right hon. Gentleman before I deal with the situation in general.

The right hon. Gentleman spent most of today, as he has done the last few months, trying to blame everyone but himself and the Government for the present situation. Every time we ask the right hon. Gentleman whether he accepts his own policies, he acts like a Pavlovian dog and we have to remind him that his policy was clearly enunciated before he was made Minister of Agriculture. It was a policy of high prices. He said: The time has come when we should have higher prices for food and no subsidies for either the agricultural or the fishing industries The right hon. Gentleman based that statement on his view of the British people, because he said: the nation has been mollycoddled for too long by receiving cheap food."—[OFFICIAL REPORT, 29th July, 1966; Vol. 732, c. 2127.] It is no use the right hon. Gentleman trying to defend that policy by saying that he meant only higher prices then, because today we are seeing the carrying out of precisely that policy. If the right hon. Gentleman has not deserted that policy it seems an extraordinary coincidence that we are seeing it being carried out in the event. Perhaps we shall be told whether the right hon. Gentleman still adheres to the view that the British nation has been mollycoddled for too long on cheap food, because then we shall know what we are dealing with.

Some of the figures that right hon. and hon. Members on the Government side have been throwing around today have relevance to a similar period—the situation at the end of 1967, when we devalued. Incidentally, when we devalued my right hon. Friend the Leader of the Opposition, then Prime Minister, at least went on television to make a statement to the nation, the position was put to the House and there was debate. But there has been no such discussion on this occasion and the Chancellor of the Exchequer allowed himself only to be interviewed. The Government have dodged what is in effect a devaluation, although it is relevant to this debate, and theirs is a shameful attitude.

We all know which event precipitated the floating of the £. Without any doubt, it was the judgment given by Sir John Donaldson in the National Industrial Relations Court, with the suggestion that the Government were hell bent on a year of fighting with the trade unions. It was that which caused the difficulty and there is plenty of foreign evidence to show that that is so. I stress this aspect because the main Government argument in the debate has been based on the thesis that rising prices are all the fault of the trade unions.

When people complain that beef prices are going up, the Minister says "There are too many wage increases". My hon. Friend the Member for Birmingham, Ladywood (Mrs. Doris Fisher) is right in saying that the time has come for the Government to accept their responsibility. Two years is a long time after the enunciation of the "at a stroke" policy. It is time that the Government accepted responsibility. It is simply not true that the only factor in increased prices at present is wages. It is not even the major factor. There is plenty of evidence to show that it is not necessarily the major factor or by any means the only factor but it possibly contributes to one-quarter of the situation. The right hon. Gentleman has no excuse for the remaining three-quarters.

Everyone knows that there is and must be pressure on wages because of the fear which so many people have of the escalation of prices both of food and of other goods. If the Government are really serious about this matter, they have it within their power to do something at once. They have blamed the trade unions for price rises, claiming that they are beyond their own control. They have blamed price rises on foreign shortages, saying that this is beyond their control. They have blamed high prices on high foreign prices, saying that these are beyond their control. But one thing that is quite definitely within their control, because they themselves have brought it about, is the Housing Finance Bill. The biggest single contribution which the Government could make to curbing inflation would be to drop that Bill.

Mr. James Hill (Southampton, Test)

It is not even law yet.

Mr. Buchan

The Government have been hell bent in Scotland and elsewhere on encouraging every council to start increasing rents from now.

Mr. William Ross (Kilmarnock)

As from last May.

Mr. Buchan

Indeed, as my right hon. Friend the Member for Kilmarnock (Mr. Ross) says, they have brought in rent increases as from last May. If the Government want to make a gesture to the trade unions, the biggest single contribution they could make would be to drop the Housing Finance Bill. There is no doubt that we are suffering inflation caused by deliberate Government policy in favour of higher prices, to which their agricultural policy is geared, although some of the inflation arises, as the Daily Telegraph said today, not from speculation from outside but from the Government's mismanagement.

I want to take a look at some of the comparative figures which have been used in the debate and above all to remind the Minister of some of his own. I ask him to consider the figures for the period following devaluation in 1967. From January, 1968, to July, 1968, the food price increase was 2.2 per cent. and from July, 1968, to January, 1969, it was 1.9 per cent. This was after a considerable devaluation. Can the right hon. Gentleman guarantee that the rise in food prices over the next six months and during the six months after that will be less or at least no more than the figures achieved after the 1967 devaluation? That will be a further test of the Government's promises. Of course, the rise should be less because the devaluation last week was less than the 1967 devaluation. I am therefore giving the Government the benefit of the doubt. But no one is rushing forward to accept that challenge on behalf of the Government, because we know that the Government's policy is dedicated to higher prices.

There was in the debate a curious defence of the Government's promises. As my hon. Friends have said, we are concerned not just with prices but also with the fact that the Government are in power on a bogus prospectus. It is no use hon. Members opposite accusing us of being hypocritical in criticising high prices because prices rose during the period of the Labour Government. We made no such promise as was made by the present Prime Minister. We are told now that he did not mean it but meant something else. We are told that he did not really mean cutting prices at a stroke but meant taking measures at a stroke which would take a long time before they paid off. We are asked "Give us time". It looks as if the policy of the time-lag has replaced the policy of "at a stroke".

What did the Prime Minister say? He said that the Conservatives would take a grip on the price-wage spiral by acting directly to reduce prices. He went on: This would, at a stroke, reduce the rise in prices, increase production and reduce unemployment. He did not say that it would reduce the increase in unemployment, which was what he said about prices. There is no getting away from the unemployment figures which the Government have allowed to rip up to record levels. He said that it would increase production and reduce unemployment. He added that It would have an immediate effect of moderating the wage-price spiral". There is no let-out there, despite the strenuous efforts of the Minister of Agriculture, Fisheries and Food. That is why we criticise the Minister in particular.

How much are the Government doing about prices? The right hon. Gentleman quoted our last six months in office, from January, 1970, to July, 1970—that was what we had to look at, he said, those terrible last six months of the Labour Government. The rise then in food prices was 5.5 per cent. and it was a very bad figure, being double almost every other figure we had had. But the comparable figure a year later, from January, 1971, to July, 1971, was 7.8 per cent., 50 per cent. up. That is the record under those who were shouting at our last six months in office.

The Financial Times, that well-known Socialist newspaper—it is even printed in pink—is very worried. This is what it says: Potato prices were mainly responsible for a 6.61 rise in the Financial Times Grocery Prices Index in mid-June….The June rise was the largest single movement since the Index was started in November, 1964. The previous 'record' was a 4.21 jump in June, 1967. It is 50 per cent. higher than any jump we have had during our period of office and the highest jump ever. This is the reality of things. It was not connected with the question of beef; it was to do with one of the commodities about which the right hon. Gentleman boasted from the Dispatch Box two months earlier, saying that he had taken measures to deal with rising prices in milk and potatoes. He has no let-out there. Enough has, perhaps, been said about beef prices. I have seen prices quoted of over £1 a 1b. for sirloin. What a record for the right hon. Gentleman—the first Minister to let the price of beef reach £1 per lb.

In the same week beer and bread rose in price—"the three Bs", beef, bread and beer. That will be the Minister's epitaph. This is not all bad because it benefits some people. It is an ill wind that blows no one any good. The right hon. Gentleman is replacing the Welfare State with the vegetarian State. The Times of 15th June said: The high price of beef has benefited others besides butchers. The Vegetarian Society of the United Kingdom announced yesterday that it had been overwhelmed by requests from non-vegetarians for advice, recipes and information since meat prices started to rise. The article goes on to say that the latest price given by the Ministry of Agriculture for home-killed rump steak was 70.3 p a 1b. but the latest price for dry nut meat was only 25p per lb. This, I am told, when mixed with vegetable juices, makes lovely rissoles or nut roast. I am beginning to see the vegetarian State developing under the right hon. Gentleman.

The next point concerns the increase in food prices because of entry to the European Economic Community. We had it again from the hon. Member for Devizes (Mr. Charles Morrison)—and I wish that he did not come from there because I am always tempted to add the rest of the limerick. There is this point about the 2 per cent. increase in food prices. It used to be 2½ per cent.; now the right hon. Gentleman has got it down to 2 per cent. We were told on Tuesday last that he did not mean that at all. There will not be a 2 per cent. increase as a result of entering the European Economic Community. He would not dare, he says, to estimate what the prices will really be.

The right hon. Gentleman said: The official estimate of the difference between our prices and Community prices, or of adopting Community prices, is not intended as a forecast of what will happen to food prices over the next few years. He could have fooled me. I thought that was what he meant, and so did everyone else in the country. He went on to say: It is intended merely to show the difference which will apply each year between our prices and Community prices."—[OFFICIAL REPORT, 20th June, 1972, Vol. 839, c. 224.] Reading between the lines—we have read the White Paper—we know what it is based upon. I am suggesting that this is how people believed it and this is why we get protests from people who say that they cannot believe it is only 2 per cent. It will not be 2 per cent. Will it be 30 per cent.? Some of it will start before we enter the Common Market.

My next point deals with the effect of this upon the poor and upon pensioners. With a higher proportion of their budget being spent upon food, an increase in food prices affects them much more. No matter at what figure the £ floats, one thing of which we can be sure is that the price of food will rise. The Government's policies are wrong. I have in my hand three-quarters of an ounce of sweets. I only wish that we had television in the House. Last year these sweets costs three old pence; this year they cost three new pence—nearly eight old pence for three-quarters of an ounce of sweets. The Government take out of the mouths of babes.

We should have a little less nonsense about people solving their own problems by shopping around, as if the aged and infirm can shop around. We should have a little less nonsense about this being entirely dependent upon consumer resistance. We found that consumer resistance to beef increased the price of lamb in some areas. Consumer resistance alone cannot help. We want a policy from the Government and if they cannot give us a policy which meets the needs of the British public, the sooner they resign the better.

6.45 p.m.

The Minister of State for Agriculture, Fisheries and Food (Mr. Anthony Stodart)

Before I reply to the debate proper may I make a personal remark about the right hon. Member for Workington (Mr. Peart) and say that I agree so much with what my hon. Friend the Member for Devizes (Mr. Charles Morrison) said. Many of us were extremely sad when we learned not long ago that the right hon. Gentleman was far from well. The whole House is delighted to see him back in his stride again and, if I may say so, no one more than I. It is always pleasant to listen to him, if only to watch the expression of bewilderment falling upon the faces of those behind him.

I will not pay the same tribute to the hon. Member for Renfrew, West (Mr. Buchan) with his rather specious arguments which took him from official indices when they did not suit him to Financial Times indices when they give him better results. I have listened to every speech, and I will try to pick up the various points which have been made as I go along. I am not absolutely certain what the hon. Member for Cornwall, North (Mr. Pardoe) was driving at when he was talking about the £ note. If he was asking for the return of the splendid old £5 note, he would have my full support.

Mr. Pardoe indicated dissent.

Mr. Stodart

I see that was not his intention. I am not clear what it was. As for the comments of my hon. Friend the Member for Birmingham, Perry Barr (Mr. Kinsey), I think that the whole House will respect his views on the subject of the recent award in view of the consistency with which he has held them. May I say to my hon. Friend the Member for Glasgow, Cathcart (Mr. Edward Taylor) that the retail price index does have a wide coverage of foods bought in shops, including manufactured foods, canned and frozen. I will, if I may, write to my hon. Friend about the other cogent points he raised, in view of the shortage of time.

As for the comment by the hon. Member for Birmingham, Ladywood (Mrs. Doris Fisher) that decimalisation would have had a better effect if we had had a £ based on the ten shillings, I have to say that that was not our doing. Both my hon. Friends the Member for Devizes and Birmingham, Edgbaston (Mrs. Knight) gave lists of various tax cuts, and I absolutely agree with my hon. Friend the Member for Edgbaston in that nothing surprised me more than the gale of laughter which greeted my right hon. Friend's remarks about income tax returns. I fill in the tax deduction cards, known as P11, for my farm workers when I pay them every fortnight. I know the effect that the Chancellor's tax concession had. Before 4th May, £6.85 a fortnight was deducted. Since then it is £4.80. That is almost exactly £1 a week less in income tax alone.

Mr. William Hamilton (Fife, West)

What is the wage?

Mr. Stodart

The point—

Mr. William Hamilton


Mr. Stodart

I am sorry, I have not got the time to give way. The hon. Member for Renfrew, West, was not interrupted.

Right hon. and hon. Gentlemen opposite are understandably anxious to shift the blame for the rise in food prices on to us, and they think that they see a good chance of doing so when a new agricultural policy has been introduced, but the effect of the new policy has been minimal and it is not the new agricultural policy which has pushed prices of food up since well before the election. The right hon. Gentleman the Member for Anglesey (Mr. Cledwyn Hughes) may recall the pressures and attacks to which he was being subjected in the weeks leading up to the election. He may even recall one of the last announcements which he made from this Dispatch Box, on 13th May,1970, when he said: I recognise that increased costs which cannot be absorbed, including increased wages, may have to be passed on in the form of higher prices. It is important that this should be acknowledged by all concerned.—[OFFICIAL REPORT, 13th May, 1970; Vol. 801, c. 1246.] About half an hour before that the right hon. Gentleman's Parliamentary Secretary—not the one with whom I have been going steady for 13 years—could claim with obvious satisfaction that in 1969 food prices rose by 5½ per cent. while wage rates rose by 10.9 per cent. That may be very nice for keeping one sweet with the wage earners who have scored out of wage awards, but it spells disaster for many others and, I feel for the nation's economy.

I agree with the hon. Gentleman the Member for Norwich, North (Mr. Wallace) who said that inflation is a battle in which the weakest go to the wall, for one cannot isolate an inflationary wage award. In these days transport touches on everything; and one must remember that the food industry today is so totally different from what it was even 10 years ago, because processing is now so widespread that, as my right hon. Friend said, an award in the steel industry has its immediate effect on things like tinned foods.

I cannot believe that hon. Gentlemen will not agree with me when I say that good food is one of the most important things in the world, and if that is accepted—

Mr. Eric S. Heffer (Liverpool, Walton)


Mr. Stodart

I am hoping to touch on the matter of beef in which the hon. Gentleman, obviously, will be very interested, and I cannot give way in the short time which I have.

If it is accepted as being very important, it must surely follow that it should be given fairly high priority in people's expenditure.

Having said that, I want to say how I think we can improve on what we have already done in slowing down the rate of increase. With all humility I would say that constructive suggestions how this should be done have not been exactly plentiful this afternoon.

My right hon. Friend is Minister of Agriculture and Food, and there are those who say that these duties are incompatible, as the interests of those who produce food may seem to be opposed to the interests of those who buy it. I do not think they are incompatible, because if we get the production of good, fresh food booming in this country, then that is the best thing for the consumer. I do not believe that it is a coincidence that the foods in which we are just about self-supporting are the cheapest ones. I do not believe that that is a coincidence with eggs, and poultry, and pork, and milk; and milk, in real terms, is cheaper than it was before the war. If that is not a tribute to the productivity of British agriculture, which has been contributed to by everyone connected with the industry, then I really do not know what it is.

I think it is the best thing for the economy as well. One of the first things I noticed that the Press commentators said about the floating of the £ was that as we were big importers of food we might have to pay more for it. If import prices were to rise—and it is by no means certain that in fact they will, because, for instance, the Irish Republic appears to contemplate no change in the relationship between the Irish pound and sterling, and the Danish Government are awaiting discussions with the EEC before making any decision about the relationship between the £ and the kroner—but even if it were true, how much better, surely, to grow much more food at home and be less vulnerable. As the hon. Member for Enfield, East (Mr. Mackie) said, we have no control whatever over world shortage.

There is no doubt that production is booming, and there is no burning of effigies of my right hon. Friend as befell the right hon. Gentleman the Member for Workington; and there is no need for my right hon. Friend to call in the Special Branch on his visits to Exeter, as the right hon. Gentleman the Member for Anglesey had to do. As for the right hon. Gentleman the Member for Kilmarnock (Mr. Ross), who was agricultural Minister in the north, we in Scotland think that we just had a very, very bad dream, and that, thank heaven, it is all over.

Mr. Ross

If the hon. Gentleman wants to tell us of his bad dream he had that night in Cumnock we are quite prepared to listen to him, and how the Ayrshire farmers kept him there and made him nearly miss his train.

Mr. Stodart

It was not a fate half as bad as, I was informed, had befallen the right hon. Gentleman a little while before.

I could not quite understand what note the right hon. Gentleman the Member for Workington was trying to strike when he was opening this debate. I thought he was trying to perform the remarkable feat of playing two tunes at once, because he complained about high prices, then he complained about my right hon. Friend using the milk fund to reduce one of the prices. Perhaps my uncertainty is due to the advice which I remember receiving from the right hon. Gentleman nearly seven years ago, longer ago than the words he quoted from my right hon. Friend; words so imperishable that every generation of Members of this House should know of them. He said this in Standing Committee B: One must be cautious. On the other hand, one must be adventurous….We must not be fuddy-duddies….If we remain put, we shall be left behind"—[OFFICIAL REPORT, Standing Committee B. 21st December. 1965; c. 161.] The House quite clearly appreciates that advice as much as I did.

I think that no Motion placed on the Order Paper by the Opposition has had a falser ring about it than this one. It is they who lit the fuse of inflation, which is responsible for so many of our difficulties today. It is we who have to deal with it, and, by means of the policies which my right hon. Friend has outlined, deal with it we shall.

Question put, That the Amendment be made:—

The House divided: Ayes 290, Noes 266.

Division No. 244.] AYES [7.0 p.m.
Adley, Robert Fletcher-Cooke, Charles Longden, Sir Gilbert
Alison, Michael (Barkston Ash) Fookes, Miss Janet Loveridge, John
Allason, James (Hemel Hempstead) Fortescue, Tim Luce, R. N.
Archer, Jeffrey (Louth) Foster, Sir John McAdden, Sir Stephen
Astor, John Fowler, Norman MacArthur, Ian
Atkins, Humphrey Fox, Marcus McCrindle, R. A.
Awdry, Daniel Fraser,Rt.Hn.Hugh(St'fford & Stone) McLaren, Martin
Baker, Kenneth (St. Marylebone) Fry, Peter Maclean, Sir Fitzroy
Balniel, Rt. Hn. Lord Galbraith, Hn. T. G. McMaster, Stanley
Batsford, Brian Gardner, Edward Macmillan,Rt.Hn.Maurice (Farnham)
Beamish, Col. Sir Tufton Gibson-Watt, David McNair-Wilson, Michael
Bell, Ronald Gilmour, Sir John (Fife, E.) McNair-Wilson, Patrick (New Forest)
Bennett, Dr. Reginald (Gosport) Godber, Rt. Hn. J. B. Maddan, Martin
Benyon, W. Goodhart, Philip Madel, David
Berry, Hn. Anthony Goodhew, Victor Marples, Rt. Hn. Ernest
Biffen, John Gorst, John Marten, Neil
Biggs-Davison, John Gower, Raymond Mather, Carol
Blaker, Peter Grant, Anthony (Harrow, C.) Maudling, Rt. Hn. Reginald
Boardman, Tom (Leicester, S.W.) Gray, Hamish Mawby, Ray
Body, Richard Green, Alan Maxwell-Hyslop, R. J.
Boscawen, Robert Griffiths, Eldon (Bury St. Edmunds) Meyer, Sir Anthony
Bossom, Sir Clive Grylls, Michael Mills, Peter (Torrington)
Bowden, Andrew Gummer, J. Selwyn Miscampbell, Norman
Braine, Sir Bernard Gurden, Harold Mitchell, Lt.-Col.C.(Aberdeenshire,W.)
Bray, Ronald Hall, Miss Joan (Keighley) Mitchell, David (Basingstoke)
Brewis, John Hall-Davis, A. G. F. Moate, Roger
Brinton, Sir Tatton Hamilton, Michael (Salisbury) Money, Ernle
Brocklebank-Fowler, Christopher Hannam, John (Exeter) Monks, Mrs. Connie
Brown, Sir Edward (Bath) Harrison, Brian (Maldon) Monro, Hector
Bruce-Gardyne, J. Harrison, Col. Sir Harwood (Eye) Montgomery, Fergus
Bryan, Sir Paul Haselhurst, Alan More, Jasper
Hastings, Stephen Morgan-Giles, Rear-Adm.
Buchanan-Smith, Alick(Angus,N & M) Havers, Michael Morrison, Charles
Buck, Antony Hayhoe, Barney Mudd, David
Bullus, Sir Eric Heath, Rt. Hn. Edward Murton, Oscar
Burden, F. A. Heseltine, Michael Nabarro, Sir Gerald
Butler, Adam (Bosworth) Hicks, Robert Neave, Airey
Campbell, Rt. Hn.G.(Moray & Nairn) Higgins, Terence L. Nicholls, Sir Harmar
Carlisle, Mark Hiley, Joseph Noble, Rt. Hn. Michael
Carr, Rt. Hn. Robert Hill, John E. B. (Norfolk, S.) Normanton, Tom
Cary, Sir Robert Hill, James (Southampton, Test)
Chapman, Sydney Holland, Philip Nott, John
Chataway, Rt. Hn. Christopher Holt, Miss Mary Onslow, Cranley
Chichester-Clark, R. Hordern, Peter Oppenheim, Mrs. Sally
Churchill, W. S. Hornby, Richard Osborn, John
Clark, William (Surrey, E.) Hornsby-Smith, Rt. Hn.Dame Patricia Owen, Idris (Stockport, N.)
Clarke, Kenneth (Rushcliffe) Howe, Hn. Sir Geoffrey (Reigate) Page, Rt. Hn. Graham (Crosby)
Cockeram, Eric Howell, David (Guildford) Page, John (Harrow, W.)
Cooke, Robert Howell, Ralph (Norfolk, N.) Parkinson, Cecil
Coombs, Derek Hunt, John Peel, John
Cooper, A. E. Hutchison, Michael Clark Percival, Ian
Cordle, John Iremonger, T. L. Peyton, Rt. Hn. John
Corfield, Rt. Hn. Sir Frederick Irvine, Bryant Godman (Rye) Pike, Miss Mervyn
Cormack, Patrick James, David Pink, R. Bonner
Costain, A. P. Jenkin, Patrick (Woodford) Powell, Rt. Hn. J. Enoch
Critchley, Julian Jennings, J. C. (Burton) Price, David (Eastleigh)
Crouch, David Jessel, Toby Prior, Rt. Hn. J. M. L.
Crowder, F. P. Johnson Smith, G. (E. Grinstead) Proudfoot, Wilfred
Dalkeith, Earl of Jopling, Michael Pym, Rt. Hn. Francis
Davies, Rt. Hn. John (Knutsford) Joseph, Rt. Hn. Sir Keith Quennell, Miss J. M.
d'Avigdor-Goldsmid, Sir Henry Kellett-Bowman, Mrs. Elaine Raison, Timothy
d'Avigdor-Goldsmid, Maj.-Gen.James Kershaw, Anthony Ramsden, Rt. Hn. James
Dean, Paul Kilfedder, James Rawlinson, Rt. Hn. Sir Peter
Deedes, Rt. Hn. W. F King, Evelyn (Dorset, S.) Redmond, Robert
Dixon, Piers King, Tom (Bridgwater) Reed, Laurance (Bolton, E.)
Drayson, G. B. Kinsey, J. R. Rees, Peter (Dover)
du Cann, Rt. Hn. Edward Kirk, Peter Rees-Davies, W. R.
Dykes, Hugh Kitson, Timothy Renton, Rt. Hn. Sir David
Eden, Sir John Knight, Mrs. Jill Rhys Williams, Sir Brandon
Edwards, Nicholas (Pembroke) Knox, David Ridley, Hn. Nicholas
Elliot, Capt. Walter (Carshalton) Lambton, Lord Ridsdale, Julian
Elliott, R. W. (N'c'te-upon-Tyne,N.) Lamont, Norman Roberts, Michael (Cardiff, N.)
Emery, Peter Lane, David Roberts, Wyn (Conway)
Eyre, Reginald Langford-Holt, Sir John Rost, Peter
Fell, Anthony Legge-Bourke, Sir Harry Royle, Anthony
Fenner, Mrs. Peggy Le Marchant, Spencer Russell, Sir Ronald
Fidler, Michael Lewis, Kenneth (Rutland) Sandys, Rt. Hn. D.
Finsberg, Geoffrey (Hampstead) Lloyd, Rt.Hn. Geoffrey (Sut'nC'dfield) Scott, Nicholas
Fisher, Nigel (Surbiton) Lloyd, Ian (P'tsm'th, Langstone) Scott-Hopkins, James
Sharples, Richard Taylor, Sir Charles (Eastbourne) Walker-Smith, Rt. Hn. Sir Derek
Shaw, Michael (Sc'b'gh & Whitby) Taylor,Edward M.(G'gow,Cathcart) Walters, Dennis
Shelton, William (Clapham) Taylor, Frank (Moss Side) Warren, Kenneth
Simeons, Charles Taylor, Robert (Croydon, N.W.) Wells, John (Maidstone)
Sinclair, Sir George Tebbit, Norman White, Roger (Gravesend)
Skeet, T. H. H. Temple, John M. Wiggin, Jerry
Smith, Dudley (W'wick & L'mington) Thatcher, Rt. Hn. Mrs. Margaret Wilkinson, John
Soref, Harold Thomas, John Stradling (Monmouth) Winterton, Nicholas
Speed, Keith Thomas, Rt. Hn. Peter (Hendon, S.) Wolrige-Gordon, Patrick
Spence, John Thompson, Sir Richard (Croydon, S.) Wood, Rt. Hn. Richard
Sproat, Iain Tilney, John Woodhouse, Hn. Christopher
Stainton, Keith Trafford, Dr. Anthony Woodnutt, Mark
Stanbrook, Ivor Trew, Peter Worsley, Marcus
Stewart-Smith, Geoffrey (Belper) Tugendhat, Christopher Wylie, Rt. Hn. N. R.
Stodart, Anthony (Edinburgh, W.) Turton, Rt. Hn. Sir Robin Younger, Hn. George
Stoddart-Scott, Col. Sir M. van Straubenzee, W. R.
Stokes, John Vaughan, Dr. Gerard TELLERS FOR THE AYES:
Stuttaford, Dr. Tom Vickers, Dame Joan Mr. Walter Clegg and
Sutcliffe, John Waddington, David Mr. Bernard Weatherill.
Tapsell, Peter Walker, Rt. Hn. Peter (Worcester)
Abse, Leo Dunnett, Jack Jones, Gwynoro (Carmarthen)
Albu, Austen Eadie, Alex Jones, T. Alec (Rhondda, W.)
Allaun, Frank (Salford, E.) Edelman, Maurice Kaufman, Gerald
Allen, Scholefield Edwards, Robert (Bilston) Kelley, Richard
Archer, Peter (Rowley Regis) Edwards, William (Merioneth) Kerr, Russell
Armstrong, Ernest Ellis, Tom Kinnock, Neil
Ashley, Jack English, Michael Lambie, David
Ashton, Joe Evans, Fred Lamborn, Harry
Atkinson, Norman Ewing, Henry Lamond, James
Bagier, Gordon A. T Faulds, Andrew Latham, Arthur
Barnes, Michael Fisher, Mrs. Doris (B'ham,Ladywood) Lawson, George
Barnett, Guy (Greenwich) Fitch, Alan (Wigan) Leadbitter, Ted
Barnett, Joel (Heywood and Royton) Fletcher, Raymond (Ilkeston) Lee, Rt. Hn. Frederick
Baxter, William Fletcher, Ted (Darlington) Leonard, Dick
Bidwell, Sydney Foley, Maurice Lever, Rt. Hn. Harold
Bishop, E. S. Foot, Michael Lewis, Arthur (W. Ham, N.)
Blenkinsop, Arthur Ford, Ben Lewis, Ron (Carlisle)
Boardman, H. (Leigh) Forrester, John Lipton, Marcus
Booth, Albert Fraser, John (Norwood) Lomas, Kenneth
Bottomley, Rt. Hn. Arthur Freeson, Reginald Loughlin, Charles
Bradley, Tom Galpern, Sir Myer Lyon, Alexander W. (York)
Broughton, Sir Alfred Garrett, W. E. Lyons, Edward (Bradford, E.)
Brown, Bob (N'c'tle-upon-Tyne, W.) Gilbert, Dr. John Mabon, Dr. J. Dickson
Brown, Hugh D. (G'gow, Provan) Ginsburg, David (Dewsbury) McBride, Neil
Brown, Ronald (Shoreditch & F'bury) Golding, John McCartney, Hugh
Buchan, Norman Gourlay, Harry McElhone, Frank
Buchanan, Richard (G'gow, Sp'burn) Grant, George (Morpeth) McGuire, Michael
Butler, Mrs. Joyce (Wood Green) Grant, John D. (Islington, E.) Mackenzie, Gregor
Campbell, I (Dunbartonshire, W.) Griffiths, Eddie (Brightside) Mackie, John
Carmichael, Neil Griffiths, Will (Exchange) Mackintosh, John P.
Carter, Ray (Birmingham, Northfield) Grimond, Rt. Hn. J. Maclennan, Robert
Carter-Jones, Lewis (Eccles) Hamilton, William (Fife, W.) McMillan, Tom (Glasgow, C.)
Castle, Rt. Hn. Barbara Hamling, William McNamara, J. Kevin
Clark, David (Colne Valley) Hannan, William (G'gow, Maryhill) Mahon, Simon (Bootle)
Cocks, Michael (Bristol. S.) Hardy, Peter Mallalieu, J. P. W. (Huddersfield, E.)
Cohen, Stanley Harper, Joseph Marks, Kenneth
Coleman, Donald Harrison, Walter (Wakefield) Marsden, F.
Concannon, J. D. Hattersley, Roy Marshall, Dr. Edmund
Conlan, Bernard Healey, Rt. Hn. Denis Mason, Rt. Hn. Roy
Corbet, Mrs. Freda Heffer, Eric S. Mayhew, Christopher
Cox, Thomas (Wandsworth, C.) Hilton, W. S. Meacher, Michael
Crawshaw, Richard Houghton, Rt. Hn. Douglas Mellish, Rt. Hn. Robert
Cronin, John Howell, Denis (Small Heath) Mendelson, John
Crosland, Rt. Hn. Anthony Huckfield, Leslie Mikardo, Ian
Crossman, Rt. Hn. Richard Hughes, Rt. Hn. Cledwyn (Anglesey) Millan, Bruce
Cunningham, Dr. J. A. (Whitehaven) Hughes, Mark (Durham) Miller, Dr. M. S.
Darling, Rt. Hn. George Hughes, Robert (Aberdeen, N.) Milne, Edward
Davies, Denzill (Llanelly) Hughes, Roy (Newport) Mitchell, R. C. (S'hampton. Itchen)
Davies, Ifor (Gower) Hunter, Adam Molloy, William
Davis, Clinton (Hackney, C.) Irvine,Rt.Hn.SirArthur(Edge Hill) Morgan, Elystan (Cardiganshire)
Davis, Terry (Bromsgrove) Janner, Greville Morris, Alfred (Wythenshawe)
Deakins, Eric Jay, Rt. Hn. Douglas Morris, Charles R. (Openshaw)
de Freitas, Rt. Hn. Sir Geoffrey Jeger, Mrs. Lena Morris, Rt. Hn. John (Aberavon)
Dell, Rt. Hn. Edmund Jenkins, Hugh (Putney) Moyle, Roland
Dempsey, James Jenkins, Rt. Hn. Roy (Stechford) Mulley, Rt. Hn. Frederick
Doig, Peter John, Brynmor Murray, Ronald King
Dormand, J. D. Johnson, Carol (Lewisham, S.) Oakes, Gordon
Douglas, Dick (Stirlingshire, E.) Johnson, Walter (Derby, S.) Ogden, Eric
Douglas-Mann, Bruce Jones, Barry (Flint, E.) O'Halloran, Michael
Duffy, A. E. P. Jones, Dan (Burnley) O'Malley, Brian
Dunn, James A. Jones,Rt.Hn.Sir Elwyn (W.Ham,S.) Oram, Bert
Orme, Stanley Roper, John Thomson, Rt. Hn. G. (Dundee, E.)
Oswald, Thomas Rose, Paul B. Thorpe, Rt. Hn. Jeremy
Owen, Dr. David (Plymouth, Sutton) Ross, Rt. Hn. William (Kilmarnock) Tinn, James
Paget, R. T. Rowlands, Ted Tomney, Frank
Palmer, Arthur Sandelson, Neville Torney, Tom
Pannell, Rt. Hn. Charles Sheldon, Robert (Ashton-under-Lyne) Tuck, Raphael
Pardoe, John Shore, Rt. Hn. Peter (Stepney) Urwin, T. W.
Parker, John (Dagenham) Short,Rt.Hn.Edward(N'c'tle-u-Tyne) Varley, Eric G.
Parry, Robert (Liverpool, Exchange) Silkin, Rt. Hn. John (Deptford) Wainwright, Edwin
Pavitt, Laurie Silkin, Hn. S. C. (Dulwich) Walden, Brian (B'ham, All Saints)
Peart, Rt. Hn. Fred Sillars, James Walker, Harold (Doncaster)
Pendry, Tom Silverman, Julius Wallace, George
Pentland, Norman Skinner, Dennis Watkins, David
Perry, Ernest G. Small, William Weitzman, David
Prentice, Rt. Hn. Reg. Smith, John (Lanarkshire, N.) Wells, William (Walsall, N.)
Prescott, John Spearing, Nigel White, James (Glasgow, Pollok)
Price, J. T. (Westhoughton) Spriggs, Leslie Whitehead, Phillip
Price, William (Rugby) Stallard, A. W. Whitlock, William
Probert, Arthur Steel, David Willey, Rt. Hn. Frederick
Rankin, John Stewart, Rt. Hn. Michael (Fulham) Williams, Alan (Swansea, W.)
Reed, D. (Sedgefield) Stoddart, David (Swindon) Williams, Mrs. Shirley (Hitchin)
Rees, Merlyn (Leeds, S.) Stonehouse, Rt. Hn. John Williams, W. T. (Warrington)
Rhodes, Geoffrey Strang, Gavin Wilson, Alexander (Hamilton)
Richard, Ivor Strauss, Rt. Hn. G. R. Wilson, William (Coventry, S.)
Roberts, Albert (Normanton) Summerskill, Hn. Dr. Shirley Woof, Robert
Roberts,Rt.Hn.Goronwy (Caernarvon) Swain, Thomas
Robertson, John (Paisley) Taverne, Dick TELLERS FOR THE NOES:
Roderick, Caerwyn E. (Br'c'n&R'dnor) Thomas,Rt.Hn.George (Cardiff,W.) Mr. James Hamilton and
Rodgers, William (Stockton-on-Tees) Thomas, Jeffrey (Abertillery) Mr. James Wellbeloved.

Question accordingly agreed to.

Main Question, as amended, put:—

The House divided: Ayes 290, Noes 266.

Division No. 245.] AYES [7.12 p.m.
Adley, Robert Cockeram, Eric Gorst, John
Alison, Michael (Barkston Ash) Cooke, Robert Gower, Raymond
Allason, James (Hemel Hempstead) Coombs, Derek Grant, Anthony (Harrow, C.)
Archer, Jeffrey (Louth) Cooper, A. E. Gray, Hamish
Astor, John Cordle, John Green, Alan
Atkins, Humphrey Corfield, Rt. Hn. Sir Frederick Griffiths, Eldon(Bury St. Edmunds)
Awdry, Daniel Cormack, Patrick Grylls, Michael
Baker, Kenneth (St. Marylebone) Costain, A. P. Gummer, J. Selwyn
Balniel, Rt. Hn. Lord Critchley, Julian Gurden, Harold
Batsford, Brian Crouch, David Hall, Miss Joan (Keighley)
Beamish, Col. Sir Tufton Crowder, F. P. Hall-Davis, A. G. F.
Bell, Ronald Dalkeith, Earl of Hamilton, Michael (Salisbury)
Bennett, Dr. Reginald (Gosport) Davies, Rt. Hn. John (Knutsford) Hannam, John (Exeter)
Benyon, W. d'Avigdor-Goldsmid, Sir Henry Harrison, Brian (Maldon)
Berry, Hn. Anthony d'Avigdor-Goldsmid.Maj. -Gen. James Harrison, Col. Sir Harwood (Eye)
Biffen, John Dean, Paul Haselhurst, Alan
Biggs-Davison, John Deedes, Rt. Hn. W. F. Hastings, Stephen
Blaker, Peter Dixon, Piers Havers, Michael
Boardman, Tom (Leicester, S.W.) Drayson, G. B. Hayhoe, Barney
Body, Richard du Cann, Rt. Hn. Edward Heath, Rt. Hn. Edward
Boscawen, Robert Dykes, Hugh Heseltine, Michael
Bossom, Sir Clive Eden, Sir John Hicks, Robert
Bowden, Andrew Edwards, Nicholas (Pembroke) Higgins, Terence L.
Braine, Sir Bernard Elliot, Capt, Walter (Carshalton) Hiley, Joseph
Bray, Ronald Elliott, R. W. (N'c'tle-upon-Tyne,N.) Hill, John E. B. (Norfolk, S.)
Brewis, John Emery, Peter Hill, James (Southampton, Test)
Brinton, Sir Tatton Eyre, Reginald Holland, Philip
Brocklebank-Fowler, Christopher Fell, Anthony Holt, Miss Mary
Brown, Sir Edward (Bath) Fenner, Mrs. Peggy Hordern, Peter
Fidler, Michael
Bruce-Gardyne, J. Finsberg, Geoffrey (Hampstead) Hornby, Richard
Bryan, Sir Paul Fisher, Nigel (Surbiton) Hornsby-Smith,Rt. Hn. Dame Patricia
Buchanan-Smith, Alick(Angus,N&M) Fletcher-Cooke, Charles Howe, Hn. Sir Geoffrey (Reigate)
Buck, Antony Fookes, Miss Janet Howell, David (Guildford)
Bullus, Sir Eric Fortescue, Tim Howell, Ralph (Norfolk, N.)
Burden, F. A. Foster, Sir John Hunt, John
Butler, Adam (Bosworth) Fowler, Norman Hutchison, Michael Clark
Campbell, Rt.Hn.G.(Moray&'Nairn) Fox, Marcus Iremonger, T. L.
Carlisle, Mark Fraser,Rt.Hn.Hugh(St'fford & Stone) Irvine, Bryant Godman (Rye)
Carr, Rt. Hn. Robert Fry, Peter James, David
Cary, Sir Robert Galbraith, Hn. T. G. Jenkin, Patrick (Woodford)
Chapman, Sydney Gardner, Edward Jennings, J. C. (Burton)
Chataway, Rt. Hn. Christopher Gibson-Watt, David Jessel, Toby
Chichester-Clark, R. Gilmour, Sir John (Fife, E.) Johnson Smith, G. (E. Grinstead)
Churchill, W. S. Godber, Rt. Hn. J. B. Jopling, Michael
Clark, William (Surrey, E.) Goodhart, Philip Joseph, Rt. Hn. Sir Keith
Clarke, Kenneth (Rushcliffe) Goodhew, Victor Kellett-Bowman, Mrs. Elaine
Kershaw, Anthony Murton, Oscar Speed, Keith
Kilfedder, James Nabarro, Sir Gerald Spence, John
King, Evelyn (Dorset, S.) Neave, Airey Sproat, Iain
King, Tom (Bridgwater) Nicholls, Sir Harmar Stainton, Keith
Kinsey, J. R. Noble Rt. Hn. Michael Stanbrook, Ivor
Kirk, Peter Normanton, Tom Stewart-Smith, Geoffrey (Belper)
Kitson, Timothy Nott, John Stodart, Anthony (Edinburgh, W.)
Knight, Mrs. Jill Onslow, Cranley Stoddart-Scott, Col. Sir M
Knox, David Oppenheim, Mrs. Sally Stokes, John
Lambton, Lord Osborn, John Stuttaford, Dr. Tom
Lamont, Norman Owen, Idris (Stockport, N.) Sutcliffe, John
Lane, David Page, Rt. Hn. Graham (Crosby) Tapsell, Peter
Langford-Holt, Sir John Page, John (Harrow, W.) Taylor, Sir Charles (Eastbourne)
Legge-Bourke, Sir Harry Parkinson, Cecil Taylor,EdwardM. (G' gow, Cathcart)
Le Merchant, Spencer Peel, John Taylor, Frank (Moss Side)
Lewis, Kenneth (Rutland) Percival, Ian Taylor, Robert (Croydon, N.W.)
Lloyd, Rt.Hn.Geoffrey(Sut'nC'dfield) Peyton, Rt. Hn. John Tebbit, Norman
Lloyd, Ian (P'tsm'th, Langstone) Pike, Miss Mervyn Temple, John M.
Longden, Sir Gilbert Pink, R. Bonner Thatcher, Rt. Hn. Mrs. Margaret
Loveridge, John Powell, Rt. Hn. J. Enoch Thomas, John Stradling (Monmouth)
Luce, R. N. Price, David (Eastleigh) Thomas, Rt. Hn. Peter (Hendon, S.)
McAdden, Sir Stephen Prior, Rt. Hn. J. M. L. Thompson, Sir Richard (Croydon, S.)
MacArthur, Ian Proudfoot, Wilfred
McGrindle, R. A. Pym, Rt. Hn. Francis Tilney, John
McLaren, Martin Quennell, Miss J. M. Trafford, Dr. Anthony
Maclean, Sir Fitzroy Raison, Timothy Trew, Peter
McMaster, Stanley Ramsden, Rt. Hn. James Tugendhat, Christopher
Macmillan,Rt.Hn.Maurice (Farnham) Rawlinson, Rt. Hn. Sir Peter Turton, Rt. Hn. Sir Robin
McNair-Wilson, Michael Redmond, Robert van Straubenzee, W. R.
McNair-Wilson, Patrick (NewForest) Reed, Laurance (Bolton, E.) Vaughan, Dr. Gerard
Maddan, Martin Rees, Peter (Dover) Vickers, Dame Joan
Madel, David Rees-Davies, W. R. Waddington, David
Marples, Rt. Hn. Ernest Renton, Rt. Hn. Sir David Walker, Rt. Hn. Peter (Worcester)
Marten, Neil Rhys Williams, Sir Brandon Walker-Smith, Rt. Hn. Sir Derek
Mather, Carol Ridley, Hn. Nicholas Walters, Dennis
Maudling, Rt. Hn. Reginald Ridsdale, Julian Warren, Kenneth
Mawby, Ray Roberts, Michael (Cardiff. N.) Wells, John (Maidstone)
Maxwell-Hyslop, R. J. Roberts, Wyn (Conway) White, Roger Gravesend)
Meyer, Sir Anthony Rost, Peter Wiggin, Jerry
Mills, Peter (Torrington) Royle, Anthony Wilkinson, John
Miscampbell, Norman Russell, Sir Ronald Winterton, Nicholas
Mitchell,Lt.-Col.C.(Aberdeenshire,W) Sandys, Rt. Hn. D. Wolrige-Gordon, Patrick
Mitchell, David (Basingstoke) Scott, Nicholas Wood, Rt. Hn. Richard
Moate, Roger Scott-Hopkins, James Woodhouse, Hn. Christopher
Money, Ernle Sharples, Richard Woodnutt, Mark
Monks, Mrs. Connie Shaw, Michael (Sc'b'gh & Whitby) Worsley, Marcus
Monro Hecor Shelton, William (Clapham) Wylie, Rt. Hn. N. R.
Montgomery, Fergus Simeons, Charles Younger. Hn. George
More, Jasper Sinclair, Sir George
Morgan-Giles, Rear-Adm. Skeet, T. H. H. TELLERS FOR THE AYES:
Morrison, Charles Smith, Dudley (W'wick & L'mington) Mr. Walter Clegg
Mudd, David Soref, Harold Mr. Bernard Weatherill
Abse, Leo Carmichael, Neil Douglas-Mann, Bruce
Albu, Austen Carter, Ray (Birmingh'm, Northfield) Duffy, A. E. P.
Allaun, Frank (Salford, E.) Carter-Jones, Lewis (Eccles) Dunn, James A.
Allen, Scholefield Castle, Rt. Hn. Barbara Dunnett, Jack
Archer, Peter (Rowley Regis) Clark, David (Colne Valley) Eadie, Alex
Armstrong, Ernest Cocks, Michael (Bristol, S.) Edelman, Maurice
Ashley, Jack Cohen, Stanley Edwards, Robert (Bilston)
Ashton, Joe Coleman, Donald Edwards, William (Merioneth)
Atkinson, Norman Concannon, J. D. Ellis, Tom
Bagier, Gordon A. T. Conlan, Bernard English, Michael
Barnes, Michael Corbet, Mrs. Freda Evans, Fred
Barnett, Guy (Greenwich) Cox, Thomas (Wandsworth, C.) Ewing, Henry
Barnett, Joel (Heywood and Royton) Crawshaw, Richard Faulds, Andrew
Baxter, William Cronin, John Fisher, Mrs. Doris (B'ham,Ladywood)
Bidwell, Sydney Crosland, Rt. Hn. Anthony Fitch, Alan (Wigan)
Bishop, E. S. Crossman, Rt. Hn. Richard Fletcher, Raymond (Ilkeston)
Blenkinsop, Arthur Cunningham, Dr. J. A. (Whitehaven) Fletcher, Ted (Darlington)
Boardman, H. (Leigh) Darling, Rt. Hn. George Foley, Maurice
Booth, Albert Davies, Denzil (Llanelly) Foot, Michael
Bottomley, Rt. Hn. Arthur Davies, Ifor (Gower) Ford, Ben
Bradley, Tom Davis, Clinton (Hackney, C.) Forrester, John
Broughton, Sir Alfred Davis, Terry (Bromsgrove) Fraser, John (Norwood)
Brown, Bob (N'c'tle-upon-Tyne,W.) Deakins, Eric Freeson, Reginald
Brown, Hugh D. (G'gow, Provan) de Freitas, Rt. Hn. Sir Geoffrey Galpern, Sir Myer
Brown, Ronald (Shoreditch & F'bury) Dell, Rt. Hn. Edmund Garrett, W. E.
Buchan, Norman Dempsey, James Gilbert, Dr. John
Buchanan, Richard (G'gow, Sp'burn) Doig, Peter Ginsburg, David (Dewsbury)
Butler, Mrs. Joyce (Wood Green) Dormand, J. D. Golding, John
Campbell, I. (Dunbartonshire, W.) Douglas Dick (Stirlingshire, E.) Gourlay, Harry
Grant, George (Morpeth) McGuire, Michael Robertson, John (Paisley)
Grant, John D. (Islington, E.) Mackenzie, Gregor Roderick, Caerwyn E.(Br'c'n&R'dnor)
Griffiths, Eddie (Brightside) Mackie, John Rodgers, William (Stockton-on-Tees)
Griffiths, Will (Exchange) Mackintosh, John P. Roper, John
Grimond, Rt. Hn. J. Maclennan, Robert Rose, Paul B.
Hamilton, William (Fife, W.) McMillan, Tom (Glasgow, C.) Ross, Rt. Hn William (Kilmarnock)
Hamling, William McNamara, J. Kevin Rowlands, Ted
Hannan, William (G'gow, Maryhill) Mahon, Simon (Bootle) Sandelson, Neville
Hardy, Peter Mallalieu, J. P. W. (Huddersfield, E.) Sheldon, Robert (Ashton-under-Lyne)
Harper, Joseph Marks, Kenneth Shore, Rt. Hn. Peter (Stepney)
Harrison, Walter (Wakefield) Marsden, F. Short, Rt.Hn.Edward(N'c'tle-u-Tyne)
Hattersley, Roy Marshall, Dr. Edmund Silkin, Rt. Hn. John (Deptford)
Healey, Rt. Hn. Denis Mason, Rt. Hn. Roy Silkin, Hn. S. C. (Dulwich)
Heffer, Eric S. Mayhew, Christopher Sillars, James
Hilton, W. S. Meacher, Michael Silverman, Julius
Houghton, Rt. Hn. Douglas Mellish, Rt. Hn. Robert Skinner, Dennis
Howell, Denis (Small Heath) Mendelson, John Small, William
Huckfield, Leslie Mikardo, Ian Smith, John (Lanarkshire, N.)
Hughes, Rt. Hn. Cledwyn (Anglesey Millan, Bruce Spearing, Nigel
Hughes, Mark (Durham) Miller, Dr. M. S. Spriggs, Leslie
Hughes, Robert (Aberdeen, N.) Milne, Edward Stallard, A. W.
Hughes, Roy (Newport) Mitchell, R. C. (S'hampton, Itchen) Steel, David
Hunter, Adam Molloy, William Stewart, Rt. Hn. Michael (Fulham)
Irvine,Rt.Hn.SirArthur(Edge Hill) Morgan, Elystan (Cardiganshire) Stoddart, David (Swindon)
Janner, Greville Morris, Alfred (Wythenshawe) Stonehouse, Rt. Hn. John
Jay, Rt. Hn. Douglas Morris, Charles R. (Openshaw) Strang, Gavin
Jeger, Mrs. Lena Morris, Rt. Hn. John (Aberavon) Strauss, Rt. Hn. G. R.
Jenkins, Hugh (Putney) Moyle, Roland Summerskill, Hn. Dr. Shirley
Jenkins, Rt. Hn. Roy (Stechford) Mulley, Rt. Hn. Frederick Swain, Thomas
John, Brynmor Murray, Ronald King Taverne, Dick
Johnson, Carol (Lewisham, S.) Oakes, Gordon Thomas,Rt.Hn.George (Cardiff,W.)
Johnson, Walter (Derby, S.) Ogden, Eric Thomas, Jeffrey (Abertillery)
Jones, Barry (Flint, E.) O'Halloran, Michael Thomson, Rt. Hn. G. (Dundee, E.)
Jones, Dan (Burnley) O'Malley, Brian Thorpe, Rt. Hn. Jeremy
Jone,Rt.Hn.Sir Elwyn(W.Ham,S.) Oram, Bert Tinn, James
Jones, Gwynoro (Carmarthen) Orme, Stanley Tomney, Frank
Jones, T. Alec (Rhondda, W.) Oswald, Thomas Torney, Tom
Owen, Dr. David (Plymouth, Sutton) Tuck, Raphael
Kaufman, Gerald Paget, R. T. Urwin, T. W.
Kelley, Richard Palmer, Arthur Varley, Eric G.
Kerr, Russell Pannell, Rt. Hn. Charles Wainwright, Edwin
Kinnock, Neil Pardoe, John Walden, Brian (B'm'ham, All Saints)
Lambie, David Parker, John (Dagenham) Walker, Harold (Doncaster)
Lamborn, Harry Parry, Robert (Liverpool, Exchange) Wallace, George
Lamond, James Pavitt, Laurie Watkins, David
Latham, Arthur Peart, Rt. Hn. Fred Weitzman, David
Lawson, George Pendry, Tom Wells, William (Walsall, N.)
Leadbitter, Ted Pentland, Norman White, James (Glasgow, Pollok)
Lee, Rt. Hn. Frederick Perry, Ernest G. Whitehead, Phillip
Leonard, Dick Prentice, Rt. Hn. Reg. Whitlock, William
Lever, Rt. Hn. Harold Prescott, John Willey, Rt. Hn. Frederick
Lewis, Arthur (W. Ham, N.) Price, J. T. (Westhoughton) Williams, Alan (Swansea, W.)
Lewis, Ron (Carlisle) Price, William (Rugby) Williams, Mrs. Shirley (Hitchin)
Lipton, Marcus Probert, Arthur Williams, W. T. (Warrington)
Lomas, Kenneth Rankin, John Wilson, Alexander (Hamilton)
Loughlin, Charles Reed, D. (Sedgefield) Wilson, William (Coventry, S.)
Lyon, Alexander W. (York) Rees, Merlyn (Leeds, S.) Woof, Robert
Lyons, Edward (Bradford, E.) Rhodes, Geoffrey
Mabon, Dr. J. Dickson Richard, Ivor TELLERS FOR THE NOES:
McBride, Neil Roberts, Albert (Normanton) Mr. James Hamilton and.
McCartney, Hugh Roberts,Rt.Hn.Goronwy (Caernarvon) Mr. James Wellbeloved
McElhone, Frank

Question accordingly agreed to.


That this House endorses the policy of Her Majesty's Government in the implementation of its election pledges to cut taxes and to stimulate investment with a view to achieving a faster sustained growth rate in the economy which will bring a real increase in living standards for the British people, and notes that the rate of increase in food prices has been halved over the past six months, and welcomes the determination of Her Majesty's Government to bring inflation under control.

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