HC Deb 16 April 1973 vol 855 cc13-5
10. Mrs. Sally Oppenheim

asked the Secretary of State for Trade and Industry how many complaints he has received from members of the public alleging unjustified price rises since the introduction of value added tax.

Sir G. Howe

Such complaints are handled by weights and measures inspectors. Returns in my Department up to 12th April indicate that during the week following the introduction of VAT the inspectors have received approximately 11,000 complaints about incorrect adjustments of prices and charges on non-food goods and services.

Mrs. Oppenheim

Does my right hon. and learned Friend not agree that with the introduction of such a complex and comprehensive new tax as VAT—despite the co-operation that has been received from the majority of traders and the magnificent job that has been done by inspectors of weights and measures throughout the country—in order to make sure that Section 12 of the Counter-Inflation Act is fully complied with and that housewives get the full benefit of the £120 million tax reduction in the food bill, extra staff for the inspectorate is highly desirable and essential?

Sir G. Howe

I agree that effective supervision of the changeover is essential. The figures I have given show the extent to which the Weights and Measures Inspectorate is playing its part. If we remember that there are well over 600,000 retail and service outlets it will be seen that the number of complaints received is only an infinitesimal fraction of the number of transactions taking place. I have no reason to believe that additional staffing of the Weights and Measures Department is necessary, bearing in mind the extent to which it is giving priority to this particularly important problem.

Mr. Jay

Is the right hon. and learned Gentleman aware that weights and measures inspectors received their instructions from the Government only about 24 hours before the changeover and as a result were quite unable to cope with the problems which confronted them?

Sir G. Howe

That is not the position. For example, I know at least one case where weights and measures inspectors were having instruction courses. One county issued a Press release about the extent to which its weights and measures inspectors were being briefed and organised well ahead of the introduction of the tax. Admittedly, the final instructions went out only some days before the changeover took place, but there is no reason to believe from the reports I have received that the Weights and Measures Inspectorate feels that it is under-briefed. It has only to refer to my prices unit for further information, if it is needed.

Mr. Fletcher-Cooke

Has my right hon. and learned Friend noticed that whereas purveyors of goods, and particularly of services, set out very accurately the increase in prices due to VAT, they are rather more coy about explaining the counterbalancing effect of the abolition of SET? Will he look into this question?

Sir G. Howe

My hon. and learned Friend is right to draw attention to the balancing effect that ought to be secured from the abolition of SET. It is because of this that I wrote to the significant retailers and undertakings in the service industries—those with turnovers above £5 million—to draw their attention to that point and to invite them to let me know what arrangements they are making to take account of it. The replies I have so far received show that they are doing this.

Mr. Alan Williams

Is the right hon. and learned Gentleman aware, as the public certainly is, that the Government have bungled the utterly unnecessary changeover to this highly inflationary tax? Has he seen the Press reports that weights and measures inspectors have been so busy recording complaints that they have had not time to investigate them? Does he realise that the number of orders which he has made to reduce prices in the critical first two weeks of the tax have been so small as to be nothing but a derisory public display of the Government's impotence? How does he justify protecting firms which have cheated the public by concealing their names? Why does he not reveal the names of the cheats?

Sir G. Howe

The hon. Member has a remarkable facility for spoiling even a bad case by overstatement. The measure of the inaccuracy of what he has said is to be found in the fact that more than 1,700 price reductions have been made by the Weights and Measures Inspectorate in the area for which my Department is responsible. That is wholly inconsistent with the proposition that the inspectorate has no time to investigate complaints made to it. The figures are a measure of the successful supervision which has taken place.