Retail Price Index (Hansard, 8 July 1974)

19. Mr. Adley
asked the Secretary of State for Prices and Consumer Protection by how much the retail price index has risen in the three months from March to May this year, inclusive; and what were the figures from July to September 1970, inclusive.

Mr. Alan Williams
During the three months ending in May the retail price index rose by 5.8 per cent. This compares with an increase of 0.4 per cent. in the three months from July to September 1970. It should be remembered, however, that the RPI is not seasonally adjusted. Seasonal food prices are an important factor in the calculation of the index. In the period February to May 1974 seasonal food prices rose by 9.5 per cent. whilst in the period June to September 1970 they fell by 13.7 per cent.

Mr. Adley
I thank the Minister for his answer, but I also note his excuses. The Labour Government have been busily proclaiming that they have taken action to deal with food prices, but they must accept responsibility for the appalling comparison between the first three months of the Labour Government and the first three months of the Conservative Government.

Mr. Williams
I am astonished that the hon. Gentleman has the effrontery to put before the House a figure of price increase of 0.4 per cent. in the first three months of the Tory Government's existence, while overlooking the fact that when they left office they left Labour to deal with price increases of 15 per cent. to 20 per cent. This is a clear indication of deterioration and lack of economic understanding by the then Conservative Government.

§ Mr. Arthur Lewis
Will my hon. Friend publish the facts concerning the extent to which the three-day working week may have adversely affected the situation? Can he say whether the increase in oil prices had any effect on it?

Mr. Williams
I am sure that my hon. Friend is correct. The three-day week was still in existence when we took office. Furthermore, we have had to contend with increases in oil prices, which contribute to inflation. Then there is the effect of value added tax, which was introduced by the Conservative Government, together with a 20 per cent. devaluation, which meant a reverse from a surplus of £1,000 million to a £1,400 million deficit.

§ Mr. Michael Latham
Can the Minister say whether the rate of inflation is getting better or worse?

Mr. Williams
If it gets better, it will be no thanks to the Conservative Party.

§ Mr. Michael Stewart
Do not the figures given in the answer suggest that a period of three months after six years of Labour Government is a much easier period to manage than a period of three months after four years of Tory Government?

Mr. Williams
It appears that the Opposition expect us by a stroke of the wand in three months to achieve something which the Tory Government failed to achieve at a stroke in three and a half years.

28. Mr. Dixon
asked the Secretary of State for Prices and Consumer Protection whether she can give an up-to-date estimate of the effect on the retail price index of Government measures announced in the last four months.

§ Mrs. Shirley Williams
During the three months to May the retail price index has risen by approximately three-fifths of 1 per cent. as a result of measures taken by the Government. This does not take account of the cut in distributors' permissible gross percentage margins, which did not come into effect until 6th May, and which I expect to reduce prices in the shops by about a further 1 per cent.

Mr. Dixon
Does the right hon. Lady realise how pleased Conservative Members are to be able to press her on so many matters in the face of the total inability of the Liberal Party to press her on the rise in prices to the housewife? Will the right hon. Lady say whether, in the coming three or four months, she expects this Government's policies to continue to fuel the inclination of prices to rise in the shops?

§ Mrs. Williams
I am sure that we are all impressed by the willingness of the Liberal Party not to see prices and consumer protection as a matter of importance, and I think that most hon. Members will regard Liberal Members as living in a happy, if an unrealistic, state in not being present for these Questions. As regards the other part of the hon. Gentleman's supplementary—[Interruption.] I am pleased to see that one Liberal Member has made an appearance—[Interruption.]

§ Mr. Speaker
Order. The House must restrain its transport of delight so that we may get more Questions answered.

§ Mrs. Williams
In the face of that excellently timed entrance, I trust that we shall be able to consider further at this Question Time the fuelling of additional prices.