§ 15. Mr. Bruce-Gardyneasked the Chancellor of the Exchequer if he will make a further statement about the progress of his discussions with the managements of the nationalised industries regarding Exchequer compensation for their participation in price restraint; and what is now his estimate of the cost of such compensation in the current financial year.
§ Mr. Patrick JenkinI have nothing to add to the information in the Answers given on 13th December to my hon. Friend the Member for Cirencester and Tewkesbury (Mr. Ridley)—[Vol. 848, c. 174–5]—and on 29th January to my hon. Friend the Member for Bedford (Mr. Skeet).—[Vol. 849, c. 316.]
§ Mr. Bruce-GardyneWill my hon. Friend confirm that not one nationalised industry is now running at a surplus on current operations, let alone approaching its required financial returns? What will be the impact of this on next year's borrowing requirement? Will it be over £4,000 million, over £4,500 million, or what?
§ Mr. JenkinMy hon. Friend will not expect me to answer the last part of his question at this time. We have always made it clear that there are dangers in 672 subsidising the nationalised industries, but the dangers of inflation are even greater. It is for that reason that we have sought to ask them to restrain their prices, and they have done so—and it has been greatly in the national interest that they have done so.
§ Mr. StonehouseDoes the Minister not agree that the artificial holding down of prices in publicly-owned industries amounts to a subsidy to private business? If these publicly-owned undertakings are to be able to finance the developments that they must have in the next few years is not a realistic pricing policy called for?
§ Mr. JenkinThe right hon. Member is right to say that a pricing structure which allows nationalised industries to earn a reasonable return on their assets, assists them to find the finance for investment. In the interests of counter-inflationary action, however, we have asked them—and they have agreed—to restrain their prices. But their investment programmes are not held back, because they have access to lending from the National Loans Fund.