HC Deb 26 November 1974 vol 882 cc236-41
Q1. Mr. Norman Lamont

asked the Prime Minister whether he will place in the Library a copy of his public speech on economic policy at the Lord Mayor's Banquet on the evening of 11th November.

Q4. Mr. Dalyell

asked the Prime Minister if he will put in the Library a copy of his public speech on 1lth November on economic policy at the Guildhall.

Q5. Mr. Skinner

asked the Prime Minister if he will place in the Library a copy of the public speech made at the Guildhall on 1lth November on economic policy.

Q7. Mr. Tebbit

asked the Prime Minister if he will place in the Library a copy of his public speech at the Guildhall on economic policy on 11th November.

Q10. Mr. Wyn Roberts

asked the Prime Minister if he will place in the Library a copy of his public speech on economic policy at the Guildhall, London, on 11th November.

The Prime Minister (Mr. Harold Wilson)

I did so the following day, Sir.

Mr. Lamont

In view of the latest, alarming increase in the retail price index, may I ask whether the Prime Minister still stands by the extraordinarily confident prediction made by the Chancellor of the Exchequer in an election Press interview when he said that from next Easter there would be a steady and continuous fall in prices? When the Chancellor talked about light at the end of the tunnel, was he not confusing it with a train coming in the other direction?

The Prime Minister

I shall probably laugh at that later, when I have had time to consider it. What my right hon. Friend said, in what the hon. Gentleman described as predictions, both as regards Easter and the end of next year, was based on the assumptions associated with that statement, and what he said was true.

Mr. Dalyell

What lead are the Government giving in encouraging the Arabs to recycle their oil surpluses, not least for the benefit of the Third World?

The Prime Minister

My hon. Friend will know that there has been a great deal of international discussion on the matter, for example at the IMF and in meetings between my right hon. Friend the Chancellor and the Finance Ministers of other leading countries. I think it is a fact that a considerable proportion of oil money has gone to Africa and other Third World countries, but on nothing like the scale required to avoid the problem of the overhanging petro-dollar surpluses. These matters were considered further last week in Paris, and my right hon. Friend is pursuing them. He will shortly be visiting some of the countries concerned.

Mr. Tebbit

Will not the Prime Minister address his mind to the point raised by my hon. Friend the Member for Kingston-upon-Thames (Mr. Lamont)? Does he not recollect that in his speech at Guildhall he did not refer to the election broadcast and the implied promises of his right hon. Friend the Chancellor, in terms either of the current 84 per cent. inflation or of the prospect for next year of inflation in single figures?

The Prime Minister

My right hon. Friend said that, on the assumptions that were then listed and published, it would be possible to get inflation down to near 10 per cent. by the end of next year. In my speech at Guildhall I referred to my own broadcast. The figure of 8.4 per cent. was a literal calculation, based—[Interruption.] My right hon. Friend, unlike the Leader of the Opposition, who tried his hand at it, can multiply a figure by four and get the right answer, and that is what happened. The same figure, rounded to 8½ per cent., appeared not only in the EEC publication but for several weeks in the Economist, which had it on exactly the same basis.

Mr. Skinner

While I have some confidence in my right hon. Friend's arithmetic, will he accept from me that it is almost bordering on the obscene to go to a Lord Mayor's Banquet, dine at a cost of more than £10 a head and then invite the workers to pull in their belts to save the country? Why does he not send them a letter next time?

The Prime Minister

Because I thought that it was more important to say what I had to say on such an occasion. I think that I admit my hon. Friend's point. I believe that my predecessor might do so. In the old days when I first went there the meal was extremely austere, consisting of a cold beef salad. I would have been happy to have had that on the occasion to which my hon. Friend has referred, particularly as I had to speak.

Mr. Roberts

The Prime Minister referred to renegotiation of our terms of entry. Will he take this opportunity to clear up certain misapprehensions which arose as a result of answers given by the Secretary of State for Trade and President of the Board of Trade last week about our trade deficit with the EEC? According to the Observer, four-fifths of the deficit was due to five sectors in particular, two of which were dairy products and cereals, which we have been buying from the EEC in greater quantities because of their cheaper price as opposed to purchases from other parts of the world.

The Prime Minister

Of course I saw this matter in the Observer, but I have never been so impressed with the statistical qualifications of the Observer as to regard anything it says as derogating from the impeccable statistics produced by my right hon. Friend.

Mr. Jay

Is my right hon. Friend aware that the hon. Member for Conway (Mr. Roberts) is wrong as usual and that dairy products can now be bought outside the EEC much more cheaply than within it?

The Prime Minister

I should want notice of the latter part of my right hon. Friend's question. I am not at all surprised to hear what he has to say about the hon. Member for Conway (Mr. Roberts).

Mr. Heath

As the social contract is a contract between the Government and trade unions, will the Prime Minister now give consideration to the publication of a White Paper setting out in the Government's view the details of the contract, what progress has been made, the wage awards which have been made in the past nine months since it came into operation and how they comply with the social contract, and the present forecasts for the rate of inflation for the coming year?

The Prime Minister

The social contract was published when it was agreed, and it was not originally between the Government and the trade unions. It was published when the present Government were in opposition. The right hon. Gentleman will recall his own record at the time. In fact, the social contract was endorsed in relation to the actions of the present Government by the TUC not nine months ago but at the end of June. It is on public record and it is in the Library. The other matters that the right hon. Gentleman raised are being almost incessantly debated in the House. They were debated for several days during the debate on the Gracious Speech. They were debated fully for three days during the debate on the Budget. The right hon. Gentleman has available to him all the information he needs.

Mr. Heath

The time has come when the country wants to be able to make an assessment of the overall picture, the consequences of the social contract, the extent to which it is being effective and the forecasts for the future. The right hon. Gentleman has said that all members of the Government are responsible for the contract, yet day by day Ministers are refusing to answer Questions about it. Last Thursday the Secretary of State for Employment refused to answer questions about the criteria and the consequences. I have just had correspondence from Scotland about this matter. In answer to a request for information, the Secretary of State for Industry has said that if my correspondent wished to have further details he should write to the General Secretary of the TUC at Congress House. What sort of government is this?

The Prime Minister

The country is in a position to form its own assessment— indeed, it made an assessment in October on the progress up to that time. The trouble that the country faces is that the right hon. Gentleman made his assessment before it even began, and he has had a continuing vested interest in increasing Britain's problems. [HON. MEMBERS: "Answer."] I shall take as long over my answer as the right hon. Gentleman took in putting his question.

The right hon. Gentleman is going round the country preaching gloom and desperately hoping that we shall not see an answer to the problems he has in mind. He will know that in a number of those cases anxiety has been frankly expressed by my right hon. Friends— [HON. MEMBERS: "Answer."] I am trying to answer the right hon. Gentleman's question. I shall do so when I can be heard.

The right hon. Gentleman has referred to some matters that he regards as being outside the social contract. Some of them have been the subject of clear comment by my right hon. Friends and by myself. He will realise that a number of them are due to problems that he left behind. For example, he must know that the nurses had been left behind, as had the teachers and the postmen. He set up an inquiry into the London weighting allowance. He should give full attention to all these matters. As for his interest in the increase in wage rates last month, four-fifths of the increase was due to his threshold payments.

Mr. Heath

Are we to have a White Paper setting out all these matters before Christmas?

The Prime Minister

I understand the right hon. Gentleman's concern about Christmas but I cannot promise that.