§ 22. Mr. Ridleyasked the Chancellor of the Exchequer if he will co-ordinate the activities of Ministers responsible for nationalised industries with a view to bringing the industries back to profitability.
§ Mr. Patrick JenkinI would refer my hon. Friend to Paragraphs 17 and 18 of the White Paper on Controlling Inflation (Cmnd. 5205). Existing arrangements for co-ordination between Ministers are satisfactory and are working well.
§ Mr. RidleyDoes not my hon. Friend agree that spending over £500 million a year on subsidising the nationalised industries and those industries not having to pay interest on their capital contributes to the increased money supply which is causing inflation? To curb inflation, would it not therefore be right to begin to get back to the level of profitable charges in this sector of the economy?
§ Mr. JenkinMy right hon. Friend and, indeed, the Government have never concealed from the House or the country 211 that there are significant disadvantages in pursuing a policy of price restraint in the nationalised industries. But in our view these are outweighed by the advantage of achieving greater price stability at a time when we are trying to bring the general level of price increases more under control. My hon. Friend will have taken note of the provisions in the White Paper that in stage 2 the nationalised industries will be subject to the same criteria for increasing prices as is private industry.
§ Mr. SheldonWill the Chief Secretary tell the House what will be the criteria for profitability for the nationalised industries? At present it looks as though they will receive an open-ended subsidy. If so, there will he no criteria of profitability to replace those which we have known for some years.
§ Mr. JenkinThere is no question of an open-ended subsidy for the nationalised industries. The extent to which they will be allowed to increase their prices and charges will be rigorously controlled and, apart from profitability, is on the same basis as that which applies to private industry.