§ 3. Mr. Norman Lamontasked the Secretary of State for Prices and Consumer Protection if she will make a statement on her plans to restrict price increases in the nationalised industries to 5 per cent. from February to July 1976.
§ 11. Mr. Tim Rentonasked the Secretary of State for Prices and Consumer Protection how she proposes to restrict price rises in the nationalised industries to 5 per cent. during the six months from 1st February.
The Minister of State, Department of Prices and Consumer Protection (Mr. Alan Williams)The Government are discussing with the nationalised industries the contribution they may be able to make to the selective price restraint scheme described in paragraph 33 of the White Paper "The Attack on Inflation" (Cmnd. 6151).
§ Mr. LamontHas the Minister of State seen the TUC's evidence to the Select Committee on Nationalised Industries suggesting that there would be little advantage to the low-income groups in making a distinction in tariffs between small and large users of fuel? Secondly, does he agree that if price increases in the nationalised industries are limited to 5 per cent. in regard to domestic users, there will be no point or benefit in such a move if it simply means that the costs to industry rise by more than that figure and that that is reflected in the general price of manufactured goods to the domestic user?
Mr. Alan WilliamsI have seen the reports, but not the detailed evidence 8 of the TUC's statement. I fully understand the difficulties. It is one of the factors that we have had to take into account where it involves low-income families living in single-fuel flats who can be high consumers of a specific fuel source. We are taking that matter into account in considering our policies.
On the second part of the hon. Gentleman's question, I draw his attention to the fact that the action involved is intended to be selective and not across the board. Nobody has said that price increases in nationalised industry services are to be held at 5 per cent., as the hon. Gentleman appears to suggest. We are discussing with the industry the possibility of price increases in some services being so held.
§ Mr. DalyellWhereas in general terms the country might be virtuous in urging this kind of restraint, in the case of the railways, where a value judgment may have to be made, does my hon. Friend realise that some of us would prefer to see railway fares rise even further, and well above the 5 per cent., if it would enable the nation to retain railway lines that are vital to the economy, particularly in the north of Scotland and other parts of Britain, and certainly in areas which, because of the growth of new towns, now face different circumstances from those that obtained when the railway lines were closed?
Mr. Alan WilliamsMy hon. Friend is correct to say that the wider social effects of decisions on the railways have to be taken into account. As a Welsh Member of Parliament, I am conscious of the circumstances that apply in Scotland and some of the other remote areas. That is another factor that would be taken into account in whatever decisions were taken, The main decision will rest with the Ministry of Transport.
§ Mr. RentonDoes the original reply given to my hon. Friend the Member for Kingston-upon-Thames (Mr. Lamont) mean that the Government are no longer sticking to their intention of keeping price rises in the nationalised industries down to 5 per cent. within the six-months' period, or does it mean that the Government now see the possibility of continuing subsidies in the nationalised industries throughout next year? If the answer is to the latter effect, may I 9 remind the Minister that in given evidence to the Select Committee on Nationalised Industries the other day the Chief Secretary to the Treasury said that the Government intended totally to phase out subsidies within the nationalised industries during 1976?
Mr. Alan WilliamsThe objective of viability remains. Nobody has altered it. Indeed, my right hon. Friend the Secretary of State for Prices and Consumer Protection and I have repeatedly made clear that this would be a selective approach. There was never any suggestion by the Government that the whole range should be kept to a 5 per cent. ceiling. It was always made clear that there would be a selective attack on prices, where practicable.
§ Mr. Mike ThomasWill my hon. Friend remember that prices and subsidies are not the same thing? Many of us take the view that the existing price structure in the nationalised industries, particularly the fuel industries, is unfair to the small consumer. When tariffs were reversed in Japan there was no question of economic viability being threatened; indeed, more revenue was produced than was required.