§ 5. Sir John Hallasked the Secretary of State for Employment to what extent basic hourly wage rates and average earnings have exceeded the increase in the cost of living during the six months to September 1974.
§ Mr. BoothBetween March and September 1974 the General Index of Retail Prices rose by 8.2 per cent. and the Index of Basic Hourly Wage Rates rose by 14.6 per cent. The Index of Average Earnings for September 1974 will not be available until later this month.
It is important to remember that since the end of the statutory pay policy in July a number of exceptional settlements have been made—for example, for postmen and British Rail—to correct the worst of the pay anomalies and inequities arising from the operation of the statutory controls. Additional payments have also been made as a result of increases in London allowances.
§ Sir John HallDoes the Minister agree that the figures he has given to the House show that the increases granted in recent months have added to the inflationary spiral and that, apart from the special nature of some increases that have been granted, claims that are now in the pipeline will add still further to the inflationary spiral? What action are the Government taking to ensure that future wage increases are kept within the terms of the social contract?
§ Mr. BoothDuring the six months from August 1973 to February 1974 the General Index of Retail Prices rose by 8.3 per cent. compared with the 8.2 per cent. which I gave in my reply. There is no evidence on that basis that there has been an enormous increase in the inflationary spiral—on the contrary. As for the attempts which the Government are making to ensure that there is not a dramatic increase, we do not expect to see a repetition of the sort of claims that came forward as a result of undertakings given in advance of the social contract wages policy to deal with particular anomalies in the public sector. If any such claims were advanced, we would 868 seek to deal with them through the social contract procedure.